2021 Form IL-2210 Instructions, Slides of Law

Download 2021 Form IL-2210 Instructions and more Slides Law in PDF only on Docsity! Page 1 of 5IL-2210 Instructions (R-12/21) Illinois Department of Revenue 2021 Form IL-2210 Instructions General Information What’s New Due to the federal and state extension to file 2020 returns, quarterly 2021 Estimated Payments can be made in 4 equal installments based upon 90% of the liability for year 2021 or 100% of the liability of year 2020 or 2019 to avoid penalty if timely made. What is the purpose of this form? This form allows you to figure penalties you may owe if you did not make timely estimated payments, pay the tax you owe by the original due date, or file a processable return by the extended due date. The late-payment penalty for underpayment of estimated tax is based on the tax shown due on your original return. Do not use the tax shown on an amended return filed after the extended due date of the return to compute your required installments in Step 2. Do I need to complete this form if I owe penalties? No, you do not need to complete this form if you owe penalties. We encourage you to let us figure your penalties and send you a bill instead of completing and filing this form yourself. If you let us figure your penalties, complete your Form IL-1040 as usual, leave Line 33 on your Form IL-1040 blank, and do not attach Form IL-2210. However, you must complete this form if you use the annualized income installment method in Step 6; or choose to enter the actual amount of tax withheld in each quarter in Step 2, Line 10a. For more information, see Publication 103, Penalties and Interest for Illinois Taxes. To receive a copy of this publication, visit our website at tax.illinois.gov. What is late-payment penalty? Late-payment penalty is a penalty assessed for failure to pay the tax you owe by the due date. This penalty could result from two different underpayment situations and is assessed at either 2 percent or 10 percent of the unpaid liability based on the number of days the payment is late. The penalty rates used on this form are for returns due on or after January 1, 2005. For returns due before January 1, 2005, see Publication 103. You will be assessed a late-payment penalty for unpaid tax if you did not pay the total tax you owe by the original due date of the return. An extension of time to file your return does not extend the amount of time you have to make your payment. You will be assessed a late-payment penalty for underpayment of estimated tax if you were required to make estimated tax payments and failed to do so, or failed to pay the required amount by the payment due date. You do not owe a late-payment penalty for underpayment of estimated tax if you qualify as a farmer for this year (check the box on Form IL-1040, Line 33a); you or your spouse were 65 years of age or older, and permanently lived in a nursing home during this year (check the box on Form IL-1040, Line 33b); you were not required to file Form IL-1040 for last year (check the box on Form IL-1040, Line 33d); last year’s Form IL-1040 had a zero tax liability (Form IL-1040, Line 14 minus Lines 15, 16, 17, and 28); or this year’s tax liability (Form IL-1040, Line 14 minus Lines 15, 16, 17, 25, 27, 28, and 29) is $1,000 or less. What is late-filing or nonfiling penalty? Late-filing or nonfiling penalty is a penalty assessed for failure to file a processable return by the extended due date. This penalty is the lesser of $250 or 2 percent of the tax amount required to be shown due on your return, reduced by withholding and payments made by the original due date and any credits allowed on your return (2021 Form IL-1040, Lines 15, 16, 17, 28, and 29.) An additional penalty will be assessed if you do not file a processable return within 30 days of the date we notify you that we are not able to process your return. This additional penalty is equal to the greater of $250 or 2 percent of the tax shown on your return, determined without regard to any payments and credits, and may be assessed up to a maximum of $5,000. What if I underpaid my estimated tax because of a change in the law during the tax year? If a change in the Illinois Income Tax Act (IITA) enacted during the tax year increased your liability and the new statute does not specifically provide for relief from penalties, you may reduce or eliminate your penalty for underpayment of estimated tax by using the annualized income installment method in Step 6 and computing your income and liability for each period according to the IITA as in effect as of the end of that period. See Specific Instructions for Step 6. What if I need additional assistance or forms? Visit our website at tax.illinois.gov for assistance, forms or schedules. Write us at Illinois Department of Revenue, P.O. Box 19001, Springfield, Illinois 62794-9001. Call 1 800 732-8866 or 217 782-3336 (TDD, telecommunications device for the deaf, at 1 800 544-5304). Visit a taxpayer assistance office - 8:00 a.m. to 5:00 p.m. (Springfield office) and 8:30 a.m. to 5:00 p.m. (all other offices), Monday through Friday. Printed by authority of the State of Illinois, web only, 1. IL-2210 Instructions (R-12/21)Page 2 of 5 Specific Instructions Step 1: Provide the following information Follow the instructions on the form. Step 2: Figure your required installments Line 1 – Enter in Column A the total amount of income tax and compassionate use of medical cannabis and sale of assets by gaming licensee surcharges shown on your 2021 Form IL-1040, Lines 14 and 22. Enter in Column B the income tax shown on your 2019 or 2020 Form IL-1040, Lines 14 and 22 (whichever is less). For Columns A and B, if a corrected return was filed for either year on or before the automatic six-month extension date, the corrected tax should be used. If an amended return was filed for either year after the automatic six-month extension date, use the most current tax reported prior to the extension date. Line 2 – Enter in Column A the total amount of credits you claimed on your Form IL-1040, Lines 15, 16, 17, 28, and 29, for this year. Enter in Column B the total amount of credits you claimed on your Form IL-1040, Lines 15, 16, 17, and 28, for the tax year you listed on Line 1, Column B. Do not include your tax withheld or estimated payments on these lines. If you are filing a joint return this year and you and your spouse did not file a joint return last year, enter in Column B the total of the taxes shown on both of your Form IL-1040 returns for last year. If you filed a joint return last year and you are either filing separate returns this year or filing a joint return with a different spouse, skip Lines 1 and 2 of Column B. Enter in Column B, Line 3, the following calculation: Lines 3 through 6 and Line 8 – Follow the instructions on the form. Line 7 – If Line 5 is $1,000 or less or if you checked the box on your Form IL-1040, Line 33a, 33b, or 33d indicating you are not required to make estimated tax payments, enter zero and skip to Step 3. Otherwise, follow the instructions on the form. We will waive the late-payment penalty for underpayment of estimated tax if you timely paid the lesser of 100 percent of one of the prior two year’s tax liability or 90 percent of the current year’s tax liability. This form reflects that waiver. Line 9a - For each quarter, enter the date that corresponds with the 15th day of the 4th, 6th, and 9th month of your tax year and the 15th day of the first month following the end of your tax year. If this date falls on a weekend or holiday, use the next business day. Line 9b – Enter the amount of your required installment for each due date shown. For most taxpayers, this is the amount shown on Line 8. However, if you annualize your income, you must complete Step 6 to determine the amount of your required installment for each due date. For taxpayers who annualize, this is the amount shown on Step 6, Line 56. Annualized income installment method: If your income was not received evenly throughout the year, you may be able to lower or eliminate the amount of your required installments by using the annualized income installment method in Step 6. If you choose to annualize your income in Step 6, you must use this method for all four installments. Line 10a – Quarters 1 through 4: Enter one-fourth of the total tax withheld (or the actual tax withheld from your wages for each quarter). We consider you to have paid Illinois tax withheld evenly over the entire year unless you send us copies of pay stubs or a letter from your employer that states the amounts actually withheld during each quarter. To figure even payments of tax withheld, divide the total amount withheld by four. If you file a joint return, include the tax withheld for both you and your spouse. Line 10b – Quarters 1 through 4: Enter the amount of pass-through withholding made on your behalf and shown on Schedule K-1-P, Partner’s or Shareholder’s Share of Income, Deductions, Credits, and Recapture, or Schedule K-1-T, Beneficiary’s Share of Income and Deductions. Enter the entire amount in the quarter in which the pass- through entity’s tax year ended. Lines 10c and 11 – Follow the instructions on the form. Lines 12 and 13 – Complete Lines 12 and 13 of each quarter before proceeding to the next quarter. Follow the instructions on the form. Step 3: Figure your unpaid tax Lines 14 through 17 – Follow the instructions on the form. Line 18 – Calculate the total of all payments made on or before the original due date of your 2021 return. Include any overpayment carried forward to 2021 from a prior year original or amended return if that prior year return was filed on or before the original due date of your 2021 Form IL-1040 (April 18, 2022, for calendar year filers), your Form IL-1040-ES and Form IL-505-I payments made this year, the pass-through withholding made on your behalf, and your withholding as shown on your W-2 and 1099 forms. Compare that total to the total of Line 9b, Quarters 1 through 4, and enter the greater amount here. Line 19 – Subtract Line 18 from Line 17. If the amount is positive, enter the amount here. You owe a late-payment penalty for unpaid tax. Enter this amount in Penalty Worksheet 2, Line 23, Column C and continue to Step 4. zero or negative, Enter the amount here. If the result is negative use brackets. Continue to Step 4 and complete Penalty Worksheet 1. Step 4: Figure your late-payment penalty Use Penalty Worksheet 1 to figure your late-payment penalty for underpayment of estimated tax. Use Penalty Worksheet 2 to figure your late-payment penalty for unpaid tax. You must follow the instructions to properly complete the penalty worksheets. Line 20 – Enter your payments, regardless of the type of payment, and the date you made the payment. List the payments in date order. Include any overpayment carried forward from a prior year original or amended return. If your prior year return that made the election to credit your overpayment against your 2021 tax was filed on or before the extended due date of that prior year return, your credit is considered to be paid on April 15, 2021. However, if all or a portion of your overpayment results from payments made after the original due date of your 2021 return, that portion of your credit is considered to be paid on the date you made the payment. after the extended due date of that prior year return, your credit is considered to be paid on the date you filed the return on which you made the election. Do not include tax credits, pass-through withholding made on your behalf, or withholding. Penalty Worksheet 1 - Late-payment penalty for underpayment of estimated tax If the amount on Line 13 is positive (greater than zero) for any quarter, you may owe a late-payment penalty for underpayment of estimated tax. Use this worksheet to figure the penalty for any unpaid quarter. If you paid the required amount from Line 13 by the due date in Step 2, Line 9a for each quarter, do not complete Penalty Worksheet 1. Line 21 – Follow the instructions below for each column. Column B - Enter in Quarters 1 through 4, the installment due date for each quarter from Step 2, Line 9a. Column C - Enter the amounts from Step 2, Line 13, on the first line of Column C for each quarter. Column D – Apply the payment with the earliest date from Line 20 to the first unpaid quarter. Complete Columns E through I. Tax minus credits shown on last year’s joint return X Tax minus credits you would have shown on a separate return for last year. Total of the taxes minus credits you and your spouse would have shown on separate returns for last year.