Subject to certain exceptions, C corporations are required to make estimated tax payments totaling 100% of the prior year’s tax liability in four equal installments. By now you should have made three installments of corporate estimated tax payments for 2018. If you did not, the you should pay the entirety of your estimated payments by January 15 of 2019 to minimize the penalties.
WHEN IS THE DEADLINE?
The fourth installment of the corporate estimated tax payments is January 15th of 2019.
HOW TO CALCULATE THE PAYMENT AMOUNT:
This amount is calculated using form 1120-W.
WHO THIS APPLIES TO:
US Corporations that report federal income taxes in form 1120, commonly known as C corporations.
HOW TO MAKE PAYMENT:
Payments must be made via eftps.gov.
WHAT IS THE PENALTY FOR NONPAYMENT/LATE PAYMENT?
26 U.S.C. § 6655 provides that if a corporation will be assessed penalties of about 5% (the federal short term rate + 3%) in addition to tax if it does not make the required estimated tax payments.
HOW TO CALCULATE THE PENALTY FOR FAILURE TO PAY?
You calculate the penalty using IRS form 2220.
LINKS AND ADDITIONAL INFORMATION:
1120-W “Estimated Tax for Corporations” https://www.irs.gov/pub/irs-pdf/f1120w.pdf
1120-W Instructions: https://www.irs.gov/pub/irs-pdf/i1120w.pdf
26 USC 6655 “Falilure by Corporations to Pay Estimated Tax” https://www.law.cornell.edu/uscode/text/26/6655
2220 “Underpayment of Estimated Tax By Corporations” https://www.irs.gov/pub/irs-pdf/f2220.pdf