Table of Contents
- What's New for 2015
- Useful Items - You may want to see:
- Tax Withholding for 2015
- Estimated Tax for 2015
- Credit for Withholding and Estimated Tax for 2014
- Underpayment Penalty for 2014
Tax law changes for 2015. When you figure how much income tax you want withheld from your pay and when you figure your estimated tax, consider tax law changes effective in 2015. For more information, see Publication 505, Tax Withholding and Estimated Tax.
Estimated tax safe harbor for higher income taxpayers. If your 2014 adjusted gross income was more than $150,000 ($75,000 if you are married filing a separate return), you must pay the smaller of 90% of your expected tax for 2015 or 110% of the tax shown on your 2014 return to avoid an estimated tax penalty.
This chapter discusses how to pay your tax as you earn or receive income during the year. In general, the federal income tax is a pay-as-you-go tax. There are two ways to pay as you go.
Withholding. If you are an employee, your employer probably withholds income tax from your pay. Tax also may be withheld from certain other income, such as pensions, bonuses, commissions, and gambling winnings. The amount withheld is paid to the IRS in your name.
Estimated tax. If you do not pay your tax through withholding, or do not pay enough tax that way, you may have to pay estimated tax. People who are in business for themselves generally will have to pay their tax this way. Also, you may have to pay estimated tax if you receive income such as dividends, interest, capital gains, rent, and royalties. Estimated tax is used to pay not only income tax, but self-employment tax and alternative minimum tax as well.
This chapter explains these methods. In addition, it also explains the following.
Credit for withholding and estimated tax. When you file your 2014 income tax return, take credit for all the income tax withheld from your salary, wages, pensions, etc., and for the estimated tax you paid for 2014. Also take credit for any excess social security or railroad retirement tax withheld (discussed in chapter 38).
Underpayment penalty. If you did not pay enough tax during the year, either through withholding or by making estimated tax payments, you may have to pay a penalty. In most cases, the IRS can figure this penalty for you. See Underpayment Penalty for 2014 at the end of this chapter.
505 Tax Withholding and Estimated Tax
Form (and Instructions)
W-4 Employee's Withholding Allowance Certificate
W-4P Withholding Certificate for Pension or Annuity Payments
W-4S Request for Federal Income Tax Withholding From Sick Pay
W-4V Voluntary Withholding Request
1040-ES Estimated Tax for Individuals
2210 Underpayment of Estimated Tax by Individuals, Estates, and Trusts
2210-F Underpayment of Estimated Tax by Farmers and Fishermen
This section discusses income tax withholding on:
Salaries and wages,
Taxable fringe benefits,
Pensions and annuities,
Unemployment compensation, and
Certain federal payments.
This section explains the rules for withholding tax from each of these types of income.
This section also covers backup withholding on interest, dividends, and other payments.
Income tax is withheld from the pay of most employees. Your pay includes your regular pay, bonuses, commissions, and vacation allowances. It also includes reimbursements and other expense allowances paid under a nonaccountable plan. See Supplemental Wages , later, for more information about reimbursements and allowances paid under a nonaccountable plan.
If your income is low enough that you will not have to pay income tax for the year, you may be exempt from withholding. This is explained under Exemption From Withholding , later.
You can ask your employer to withhold income tax from noncash wages and other wages not subject to withholding. If your employer does not agree to withhold tax, or if not enough is withheld, you may have to pay estimated tax, as discussed later under Estimated Tax for 2015 .
Pays you cash wages of less than $150 during the year, and
Has expenditures for agricultural labor totaling less than $2,500 during the year.
The amount of income tax your employer withholds from your regular pay depends on two things.
The amount you earn in each payroll period.
The information you give your employer on Form W-4.
Form W-4 includes four types of information that your employer will use to figure your withholding.
Whether to withhold at the single rate or at the lower married rate.
How many withholding allowances you claim (each allowance reduces the amount withheld).
Whether you want an additional amount withheld.
Whether you are claiming an exemption from withholding in 2015. See Exemption From Withholding , later.
When you start a new job, you must fill out Form W-4 and give it to your employer. Your employer should have copies of the form. If you need to change the information later, you must fill out a new form.
If you work only part of the year (for example, you start working after the beginning of the year), too much tax may be withheld. You may be able to avoid overwithholding if your employer agrees to use the part-year method. See Part-Year Method in chapter 1 of Publication 505 for more information.
During the year changes may occur to your marital status, exemptions, adjustments, deductions, or credits you expect to claim on your tax return. When this happens, you may need to give your employer a new Form W-4 to change your withholding status or your number of allowances.
If the changes reduce the number of allowances you are claiming or changes your marital status from married to single, you must give your employer a new Form W-4 within 10 days.
Generally, you can submit a new Form W-4 whenever you wish to change the number of your withholding allowances for any other reason.
After you have given your employer a Form W-4, you can check to see whether the amount of tax withheld from your pay is too little or too much. If too much or too little tax is being withheld, you should give your employer a new Form W-4 to change your withholding. You should try to have your withholding match your actual tax liability. If not enough tax is withheld, you will owe tax at the end of the year and may have to pay interest and a penalty. If too much tax is withheld, you will lose the use of that money until you get your refund. Always check your withholding if there are personal or financial changes in your life or changes in the law that might change your tax liability.
Form W-4 has worksheets to help you figure how many withholding allowances you can claim. The worksheets are for your own records. Do not give them to your employer.
In most situations, the tax withheld from your pay will be close to the tax you figure on your return if you follow these two rules.
You accurately complete all the Form W-4 worksheets that apply to you.
You give your employer a new Form W-4 when changes occur.
But because the worksheets and withholding methods do not account for all possible situations, you may not be getting the right amount withheld. This is most likely to happen in the following situations.
You are married and both you and your spouse work.
You have more than one job at a time.
You have nonwage income, such as interest, dividends, alimony, unemployment compensation, or self-employment income.
You will owe additional amounts with your return, such as self-employment tax.
Your withholding is based on obsolete Form W-4 information for a substantial part of the year.
Your earnings are more than the amount shown under Check your withholding in the instructions at the top of page 1 of Form W-4.
You work only part of the year.
You change the number of your withholding allowances during the year.
To make sure you are getting the right amount of tax withheld, get Publication 505. It will help you compare the total tax to be withheld during the year with the tax you can expect to figure on your return. It also will help you determine how much, if any, additional withholding is needed each payday to avoid owing tax when you file your return. If you do not have enough tax withheld, you may have to pay estimated tax, as explained under Estimated Tax for 2015 , later.
It may be helpful for you to know some of the withholding rules your employer must follow. These rules can affect how to fill out your Form W-4 and how to handle problems that may arise.
If you claim exemption from withholding, your employer will not withhold federal income tax from your wages. The exemption applies only to income tax, not to social security, Medicare, or FUTA tax withholding.
You can claim exemption from withholding for 2015 only if both of the following situations apply.
For 2014 you had a right to a refund of all federal income tax withheld because you had no tax liability.
For 2015 you expect a refund of all federal income tax withheld because you expect to have no tax liability.
Supplemental wages include bonuses, commissions, overtime pay, vacation allowances, certain sick pay, and expense allowances under certain plans. The payer can figure withholding on supplemental wages using the same method used for your regular wages. However, if these payments are identified separately from your regular wages, your employer or other payer of supplemental wages can withhold income tax from these wages at a flat rate.
You may have to pay a penalty of $500 if both of the following apply.
You make statements or claim withholding allowances on your Form W-4 that reduce the amount of tax withheld.
You have no reasonable basis for those statements or allowances at the time you prepare your Form W-4.
There is also a criminal penalty for willfully supplying false or fraudulent information on your Form W-4 or for willfully failing to supply information that would increase the amount withheld. The penalty upon conviction can be either a fine of up to $1,000 or imprisonment for up to 1 year, or both.
These penalties will apply if you deliberately and knowingly falsify your Form W-4 in an attempt to reduce or eliminate the proper withholding of taxes. A simple error or an honest mistake will not result in one of these penalties. For example, a person who has tried to figure the number of withholding allowances correctly, but claims seven when the proper number is six, will not be charged a W-4 penalty.
The tips you receive while working on your job are considered part of your pay. You must include your tips on your tax return on the same line as your regular pay. However, tax is not withheld directly from tip income, as it is from your regular pay. Nevertheless, your employer will take into account the tips you report when figuring how much to withhold from your regular pay.
See chapter 6 for information on reporting your tips to your employer. For more information on the withholding rules for tip income, see Publication 531, Reporting Tip Income.
By withholding at the regular rate on the sum of your pay plus your reported tips.
By withholding at the regular rate on your pay plus a percentage of your reported tips.
The value of certain noncash fringe benefits you receive from your employer is considered part of your pay. Your employer generally must withhold income tax on these benefits from your regular pay.
For information on fringe benefits, see Fringe Benefits under Employee Compensation in chapter 5.
Although the value of your personal use of an employer-provided car, truck, or other highway motor vehicle is taxable, your employer can choose not to withhold income tax on that amount. Your employer must notify you if this choice is made.
For more information on withholding on taxable fringe benefits, see chapter 1 of Publication 505.
Sick pay is a payment to you to replace your regular wages while you are temporarily absent from work due to sickness or personal injury. To qualify as sick pay, it must be paid under a plan to which your employer is a party.
If you receive sick pay from your employer or an agent of your employer, income tax must be withheld. An agent who does not pay regular wages to you may choose to withhold income tax at a flat rate.
However, if you receive sick pay from a third party who is not acting as an agent of your employer, income tax will be withheld only if you choose to have it withheld. See Form W-4S , later.
If you receive payments under a plan in which your employer does not participate (such as an accident or health plan where you paid all the premiums), the payments are not sick pay and usually are not taxable.
Income tax usually will be withheld from your pension or annuity distributions unless you choose not to have it withheld. This rule applies to distributions from:
The amount withheld depends on whether you receive payments spread out over more than 1 year (periodic payments), within 1 year (nonperiodic payments), or as an eligible rollover distribution (ERD). Income tax withholding from an ERD is mandatory.
Income tax is withheld at a flat 25% rate from certain kinds of gambling winnings.
Gambling winnings of more than $5,000 from the following sources are subject to income tax withholding.
Any sweepstakes; wagering pool, including payments made to winners of poker tournaments; or lottery.
Any other wager, if the proceeds are at least 300 times the amount of the bet.
It does not matter whether your winnings are paid in cash, in property, or as an annuity. Winnings not paid in cash are taken into account at their fair market value.
If you do not pay enough tax, either through withholding or estimated tax, or a combination of both, you may have to pay a penalty. See Underpayment Penalty for 2014 at the end of this chapter.
You can choose to have income tax withheld from unemployment compensation. To make this choice, fill out Form W-4V (or a similar form provided by the payer) and give it to the payer.
All unemployment compensation is taxable. So, if you do not have income tax withheld, you may have to pay estimated tax. See Estimated Tax for 2015 , later.
If you do not pay enough tax, either through withholding or estimated tax, or a combination of both, you may have to pay a penalty. For information, see Underpayment Penalty for 2014 at the end of this chapter.
You can choose to have income tax withheld from certain federal payments you receive. These payments are:
Social security benefits,
Tier 1 railroad retirement benefits,
Commodity credit corporation loans you choose to include in your gross income,
Payments under the Agricultural Act of 1949 (7 U.S.C. 1421 et. seq.), as amended, or title II of the Disaster Assistance Act of 1988, that are treated as insurance proceeds and that you receive because:
Your crops were destroyed or damaged by drought, flood, or any other natural disaster, or
You were unable to plant crops because of a natural disaster described in (a), and
Any other payment under Federal law as determined by the Secretary.
If you do not choose to have income tax withheld, you may have to pay estimated tax. See Estimated Tax for 2015 , later.
If you do not pay enough tax, either through withholding or estimated tax, or a combination of both, you may have to pay a penalty. For information, see Underpayment Penalty for 2014 at the end of this chapter.
Banks or other businesses that pay you certain kinds of income must file an information return (Form 1099) with the IRS. The information return shows how much you were paid during the year. It also includes your name and taxpayer identification number (TIN). TINs are explained in chapter 1 under Social Security Number (SSN) .
These payments generally are not subject to withholding. However, “backup” withholding is required in certain situations. Backup withholding can apply to most kinds of payments that are reported on Form 1099.
The payer must withhold at a flat 28% rate in the following situations.
You do not give the payer your TIN in the required manner.
The IRS notifies the payer that the TIN you gave is incorrect.
You are required, but fail, to certify that you are not subject to backup withholding.
The IRS notifies the payer to start withholding on interest or dividends because you have underreported interest or dividends on your income tax return. The IRS will do this only after it has mailed you four notices over at least a 210-day period.
See Backup Withholding in chapter 1 of Publication 505 for more information.
Estimated tax is the method used to pay tax on income that is not subject to withholding. This includes income from self-employment, interest, dividends, alimony, rent, gains from the sale of assets, prizes, and awards. You also may have to pay estimated tax if the amount of income tax being withheld from your salary, pension, or other income is not enough.
Estimated tax is used to pay both income tax and self-employment tax, as well as other taxes and amounts reported on your tax return. If you do not pay enough tax, either through withholding or estimated tax, or a combination of both, you may have to pay a penalty. If you do not pay enough by the due date of each payment period (see When To Pay Estimated Tax , later), you may be charged a penalty even if you are due a refund when you file your tax return. For information on when the penalty applies, see Underpayment Penalty for 2014 at the end of this chapter.
If you receive salaries or wages, you can avoid having to pay estimated tax by asking your employer to take more tax out of your earnings. To do this, give a new Form W-4 to your employer. See chapter 1 of Publication 505.
You had no tax liability for 2014.
You were a U.S. citizen or resident alien for the whole year.
Your 2014 tax year covered a 12-month period.
If you owe additional tax for 2014, you may have to pay estimated tax for 2015.
You can use the following general rule as a guide during the year to see if you will have enough withholding, or if you should increase your withholding or make estimated tax payments.
You expect to owe at least $1,000 in tax for 2015, after subtracting your withholding and refundable credits.
You expect your withholding plus your refundable credits to be less than the smaller of:
90% of the tax to be shown on your 2015 tax return, or
100% of the tax shown on your 2014 tax return (but see Special rules for farmers, fishermen, and higher income taxpayers , later). Your 2014 tax return must cover all 12 months.
You are legally separated under a decree of divorce or separate maintenance,
You and your spouse have different tax years, or
Either spouse is a nonresident alien (unless that spouse elected to be treated as a resident alien for tax purposes (see chapter 1 of Publication 519)).
|The tax you would have paid had you filed a separate return|
|The total tax you and your spouse would have paid had you filed separate returns|
Joe and Heather filed a joint return for 2014 showing taxable income of $48,500 and a tax of $6,371. Of the $48,500 taxable income, $40,100 was Joe's and the rest was Heather's. For 2015, they plan to file married filing separately. Joe figures his share of the tax on the 2014 joint return as follows.
|Tax on $40,100 based on a separate return||$5,888|
|Tax on $8,400 based on a separate return||843|
|Joe's percentage of total ($5,888 ÷ $6,731)||87.5%|
|Joe's share of tax on joint return
($6,371 × 87.5%)
When figuring your 2015 estimated tax, it may be helpful to use your income, deductions, and credits for 2014 as a starting point. Use your 2014 federal tax return as a guide. You can use Form 1040-ES and Publication 505 to figure your estimated tax. Nonresident aliens use Form 1040-ES (NR) and Publication 505 to figure estimated tax (see chapter 8 of Publication 519 for more information).
You must make adjustments both for changes in your own situation and for recent changes in the tax law. For a discussion of these changes, visit IRS.gov.
For estimated tax purposes, the tax year is divided into four payment periods. Each period has a specific payment due date. If you do not pay enough tax by the due date of each payment period, you may be charged a penalty even if you are due a refund when you file your income tax return. The payment periods and due dates for estimated tax payments are shown next.
|For the period:||Due date:*|
|Jan. 1 – March 31||April 15|
|April 1 – May 31||June 15|
|June 1 – August 31||Sept. 15|
|Sept. 1– Dec. 31||Jan. 15, next year|
You do not have to make estimated tax payments until you have income on which you will owe income tax. If you have income subject to estimated tax during the first payment period, you must make your first payment by the due date for the first payment period. You can pay all your estimated tax at that time, or you can pay it in installments. If you choose to pay in installments, make your first payment by the due date for the first payment period. Make your remaining installment payments by the due dates for the later periods.
|If you first have income on which you must pay estimated tax:||Make a
|Before April 1||April 15||June 15
Jan. 15 next year
|April 1–May 31||June 15||Sept. 15
Jan. 15 next year
|June 1–Aug. 31||Sept. 15||Jan. 15 next year|
|After Aug. 31||Jan. 15
You should pay enough estimated tax by the due date of each payment period to avoid a penalty for that period. You can figure your required payment for each period by using either the regular installment method or the annualized income installment method. These methods are described in chapter 2 of Publication 505. If you do not pay enough during each payment period, you may be charged a penalty even if you are due a refund when you file your tax return.
If the earlier discussion of No income subject to estimated tax during first period or the later discussion of Change in estimated tax applies to you, you may benefit from reading Annualized Income Installment Method in chapter 2 of Publication 505 for information on how to avoid a penalty.
You do not have to pay estimated tax if your withholding in each payment period is at least as much as:
One-fourth of your required annual payment, or
Your required annualized income installment for that period.
You also do not have to pay estimated tax if you will pay enough through withholding to keep the amount you owe with your return under $1,000.
There are several ways to pay estimated tax.
If you show an overpayment of tax after completing your Form 1040 or Form 1040A for 2014, you can apply part or all of it to your estimated tax for 2015. On line 77 of Form 1040, or line 49 of Form 1040A, enter the amount you want credited to your estimated tax rather than refunded. Take the amount you have credited into account when figuring your estimated tax payments.
You cannot have any of the amount you credited to your estimated tax refunded to you until you file your tax return for the following year. You also cannot use that overpayment in any other way.
Paying online is convenient and secure and helps make sure we get your payments on time.
You can pay online with a direct transfer from your bank account using Direct Pay, the Electronic Federal Tax Payment System, or by debit or credit card.
To pay your taxes online or for more information, go to www.irs.gov/Payments.
Paying by phone is another safe and secure method of paying electronically. Use one of the following methods.
Direct transfer from your bank account.
Debit or credit card.
To pay by direct transfer from your bank account, call 1-800-555-4477 (English), 1-800-244-4829 (Español). People who are deaf, hard of hearing, or have a speech disability and who have access to TTY/TDD can call 1-800-733-4829.
To pay using a debit or credit card, you can call one of the following service providers. There is a convenience fee charged by these providers that varies by provider, card type, and payment amount.
WorldPay US, Inc.
Official Payments Corporation
For the latest details on how to pay by phone, go to www.irs.gov/Payments.
Each payment of estimated tax by check or money order must be accompanied by a payment voucher from Form 1040-ES.
During 2014, if you:
made at least one estimated tax payment but not by electronic means,
did not use software or a paid preparer to prepare or file your return,
then you should receive a copy of the 2015 Form 1040-ES/V.
The enclosed payment vouchers will be preprinted with your name, address, and social security number. Using the preprinted vouchers will speed processing, reduce the chance of error, and help save processing costs.
Use the window envelopes that came with your Form 1040-ES package. If you use your own envelopes, make sure you mail your payment vouchers to the address shown in the Form 1040-ES instructions for the place where you live.
These criteria can change without notice. If you do not receive a Form 1040-ES/V package and you are required to make an estimated tax payment, you should go to www.irs.gov/form1040es and print a copy of Form 1040-ES which includes four blank payment vouchers. Complete one of these and make your payment timely to avoid penalties for paying late.
If you did not pay estimated tax last year, you can order Form 1040-ES from the IRS (see inside back cover of this publication) or download it from IRS.gov. Follow the instructions to make sure you use the vouchers correctly.
When you file your 2014 income tax return, take credit for all the income tax and excess social security or railroad retirement tax withheld from your salary, wages, pensions, etc. Also take credit for the estimated tax you paid for 2014. These credits are subtracted from your total tax. Because these credits are refundable, you should file a return and claim these credits, even if you do not owe tax.
If you had income tax withheld during 2014, you should be sent a statement by February 2, 2015, showing your income and the tax withheld. Depending on the source of your income, you should receive:
Form W-2, Wage and Tax Statement,
Form W-2G, Certain Gambling Winnings, or
A form in the 1099 series.
Your employer is required to provide or send Form W-2 to you no later than February 2, 2015. You should receive a separate Form W-2 from each employer you worked for.
If you stopped working before the end of 2014, your employer could have given you your Form W-2 at any time after you stopped working. However, your employer must provide or send it to you by February 2, 2015.
If you ask for the form, your employer must send it to you within 30 days after receiving your written request or within 30 days after your final wage payment, whichever is later.
If you have not received your Form W-2 by February 2, you should ask your employer for it. If you do not receive it by February 16, call the IRS.
Form W-2 shows your total pay and other compensation and the income tax, social security tax, and Medicare tax that was withheld during the year. Include the federal income tax withheld (as shown in box 2 of Form W-2) on:
Line 64 if you file Form 1040,
Line 40 if you file Form 1040A, or
Line 7 if you file Form 1040EZ.
In addition, Form W-2 is used to report any taxable sick pay you received and any income tax withheld from your sick pay.
If you had gambling winnings in 2014, the payer may have withheld income tax. If tax was withheld, the payer will give you a Form W-2G showing the amount you won and the amount of tax withheld.
Report the amounts you won on line 21 of Form 1040. Take credit for the tax withheld on line 64 of Form 1040. If you had gambling winnings, you must use Form 1040; you cannot use Form 1040A or Form 1040EZ.
Most forms in the 1099 series are not filed with your return. These forms should be furnished to you by February 2, 2015 (or, for Forms 1099-B, 1099-S, and certain Forms 1099-MISC, by February 16, 2015). Unless instructed to file any of these forms with your return, keep them for your records. There are several different forms in this series, including:
Form 1099-B, Proceeds From Broker and Barter Exchange Transactions;
Form 1099-DIV, Dividends and Distributions;
Form 1099-G, Certain Government Payments;
Form 1099-INT, Interest Income;
Form 1099-K, Payment Card and Third Party Network Transactions;
Form 1099-MISC, Miscellaneous Income;
Form 1099-OID, Original Issue Discount;
Form 1099-PATR, Taxable Distributions Received from Cooperatives;
Form 1099-Q, Payments From Qualified Education Programs;
Form 1099-R, Distributions From Pensions, Annuities, Retirement or Profit-Sharing Plans, IRAs, Insurance Contracts, etc.;
Form 1099-S, Proceeds From Real Estate Transactions;
Form RRB-1099, Payments by the Railroad Retirement Board.
If you received the types of income reported on some forms in the 1099 series, you may not be able to use Form 1040A or Form 1040EZ. See the instructions to these forms for details.
If you receive a form with incorrect information on it, you should ask the payer for a corrected form. Call the telephone number or write to the address given for the payer on the form. The corrected Form W-2G or Form 1099 you receive will have an “X” in the “CORRECTED” box at the top of the form. A special form, Form W-2c, Corrected Wage and Tax Statement, is used to correct a Form W-2.
In certain situations, you will receive two forms in place of the original incorrect form. This will happen when your taxpayer identification number is wrong or missing, your name and address are wrong, or you received the wrong type of form (for example, a Form 1099-DIV instead of a Form 1099-INT). One new form you receive will be the same incorrect form or have the same incorrect information, but all money amounts will be zero. This form will have an “X” in the “CORRECTED” box at the top of the form. The second new form should have all the correct information, prepared as though it is the original (the “CORRECTED” box will not be checked).
If you file your return and you later receive a form for income that you did not include on your return, you should report the income and take credit for any income tax withheld by filing Form 1040X, Amended U.S. Individual Income Tax Return.
If you are married but file a separate return, you can take credit only for the tax withheld from your own income. Do not include any amount withheld from your spouse's income. However, different rules may apply if you live in a community property state.
Community property states are listed in chapter 2. For more information on these rules, and some exceptions, see Publication 555, Community Property.
If you file your tax return on the basis of a fiscal year (a 12-month period ending on the last day of any month except December), you must follow special rules to determine your credit for federal income tax withholding. For a discussion of how to take credit for withholding on a fiscal year return, see Fiscal Years (FY) in chapter 3 of Publication 505.
Take credit for all your estimated tax payments for 2014 on line 65 of Form 1040 or line 41 of Form 1040A. Include any overpayment from 2013 that you had credited to your 2014 estimated tax. You must use Form 1040 or Form 1040A if you paid estimated tax. You cannot use Form 1040EZ.
When you made the payments,
The amount of each payment,
Your name when you made the payments, and
Your social security number.
If you and your spouse made separate estimated tax payments for 2014 and you file separate returns, you can take credit only for your own payments.
If you made joint estimated tax payments, you must decide how to divide the payments between your returns. One of you can claim all of the estimated tax paid and the other none, or you can divide it in any other way you agree on. If you cannot agree, you must divide the payments in proportion to each spouse's individual tax as shown on your separate returns for 2014.
If you made joint estimated tax payments for 2014, and you were divorced during the year, either you or your former spouse can claim all of the joint payments, or you each can claim part of them. If you cannot agree on how to divide the payments, you must divide them in proportion to each spouse's individual tax as shown on your separate returns for 2014.
If you claim any of the joint payments on your tax return, enter your former spouse's social security number (SSN) in the space provided on the front of Form 1040 or Form 1040A. If you divorced and remarried in 2014, enter your present spouse's SSN in that space and write your former spouse's SSN, followed by “DIV,” to the left of Form 1040, line 65, or Form 1040A, line 41.
If you did not pay enough tax, either through withholding or by making timely estimated tax payments, you will have an underpayment of estimated tax and you may have to pay a penalty.
Generally, you will not have to pay a penalty for 2014 if any of the following apply.
The total of your withholding and estimated tax payments was at least as much as your 2013 tax (or 110% of your 2013 tax if your AGI was more than $150,000, $75,000 if your 2014 filing status is married filing separately) and you paid all required estimated tax payments on time.
The tax balance due on your 2014 return is no more than 10% of your total 2014 tax, and you paid all required estimated tax payments on time.
Your total 2014 tax minus your withholding and refundable credits is less than $1,000.
You did not have a tax liability for 2013 and your 2013 tax year was 12 months, or
You did not have any withholding taxes and your current year tax less any household employment taxes is less than $1,000.
See Publication 505, chapter 4, for a definition of “total tax” for 2013 and 2014.
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