Form AR2210 — Penalty for Underpayment of Estimated Tax (Individual) Instructions

# preamble

INSTR Instructions For AR2210 Estimated Income Tax Penalty

# EXCEPTIONS

1. (a) Every taxpayer subject to the tax levied by the Arkansas Income Tax Act shall make and file with the Commissioner 1. Taxpayers whose income from farming for the income year can a declaration of the estimated tax for the income year if the reasonably be expected to amount to at least two thirds (2/3) of taxpayer can reasonably expect the estimated tax to be $1,000 the total gross income from all sources for the income year, may or more and income tax withholdings for the income year do file such declaration and pay the estimated tax on or before the not equal 90% of the estimated tax. ¿IWHHQWK th) day of the second (2nd) month after the close of the income year In lieu of filing any declaration you may file an No penalty shall be imposed for a tax year if the income tax return and pay the tax on or before the fifteenth 3'F tax shown on the return for such tax year is less day of the third (3rd) month after the close of the income year. than $1,000, or where the original amount of estimated tax is the same amount shown to be 2. ,QOLHXRI¿OLQJWKHIRXUWK th) quarter installment the taxpayer may due by the return of the taxpayer for the preceding file an income tax return and pay the tax on or before January income year where such return showing a liability RURQWKHODVWGD\RIWKH¿UVW st) month after the close of the for tax was filed by the taxpayer for the preceding income year. income year of twelve (12) months. 3. No penalty shall be imposed for a tax year if: (b) The declaration of estimated tax shall be made on such forms (a) the preceding tax year was a tax year of twelve (12) months, and shall include such information as the Commissioner and shall prescribe. Individual forms can be obtained by calling (b) the taxpayer did not have a tax liability for the preceding tax year (501) 682-1100 or from our website www.arkansas.gov/ and incometax. (c) the taxpayer was a resident of Arkansas throughout the preceding tax year. 

c The declaration with the first payment must be filed with the Commissioner on or before the fifteenth 3'F #~8 .% 3'$ %.413' 4. No penalty shall be imposed with respect to any underpayment (4th) month of the income year of the taxpayer. The remaining if the Commissioner of Revenue determines that by reasons of filings and payments are due on the fifteenth 3'F #~8 .% 3'$ casualty, disaster, or other unusual circumstances the imposition sixth (6th) month, ninth (9th PRQWKDQG¿UVW st) month after of such penalty would be against equity and good conscience. the close of the income year. 5. No penalty shall be imposed with respect to any underestimate 

d A taxpayer who due to change of circumstances first meets or underpayment if the Commissioner determines that: the requirements for filing a declaration after the fifteenth 3'F (a) the taxpayer day of the fourth (4th) month of the income year, shall make (i) retired after having attained age 62, or and file the declaration on or before the next regular quarterly (ii) became disabled in the tax year for which such estimated tax payment date. payments were required to be made or in the tax year preceding such tax year, and (b) such underpayment was due to reasonable cause and not 2. (a) A taxpayer who makes a declaration of estimated tax for the to willful neglect. income year shall estimate an amount not less than ninety percent (90%) of the amount actually due. 6. Taxpayers with varied income may benefit by computing the ten percent (10%) penalty on an (b) If a taxpayer fails to make a declaration of estimated tax and annualized basis. The penalty is computed using pay on the quarterly due date the equivalent to at least ninety Form AR2210A which must be submitted with Form percent (90%) of the amount actually due, a penalty of ten AR1000F/AR1000NR or Form AR1002F/AR1002NR. If percent (10%) per annum shall be added to the amount of penalty computed using Form AR2210A, write "6" on the underestimate. The ten percent (10%) per annum penalty Form AR1000F/AR1000NR, box 52A or Form AR1002F/ will be applied on a quarterly basis. A taxpayer who has an AR1002NR, box 38A. uneven income may compute the ten percent (10%) penalty on an annualized basis. The underestimate penalty is computed on the lesser of the current year's tax liability or the previous year's tax liability. 3. (a) The penalty provided in ACA §26-18-208 (Supp.1997) for failure to make correct payments of estimated income tax shall not apply to the exceptions noted hereafter. AR2210 Inst. Page 1 (R 7/5/2024)

INSTR Instructions For AR2210 Estimated Income Tax Penalty

# PENALTY COMPUTATION EXAMPLE

Part II: The underpayment of estimated tax shall be computed as follows: The number of days from the due date of the quarterly payment to the date payment is actually made divided by 365, times ten percent (10%), times the amount of underpayment.

Line 1 Tax Liability $5,000

Line 2 90% of Tax Liability $4,500

Line 3 Payments $2,000

Line 4 Line (1) less Line (3) $3,000

Line 5 Prior Year Tax Liability $3,000

# Line 6

Required Annual Payment $3,000

[Lesser of (2) or (5)] Note: Payments reported on Line (3) shall be deemed to have been paid in four (4) equal payments on the quarterly due dates. Part III: Required Installments ...................... $3,000 divided by 4 = $750 Payments......................................... $2,000 divided by 4 = $500 Column (a) 4-15-2025 Required Installment $750

Payment 4-15-2025 $500

Underpayment $250

Paid 6-15-2025 ($250)

-0-

4-15-2025 to 6-15-2025 = 61 days

61/365 X .10 X $250 = $4

First Quarter Penalty...........$ 4 Column (b) 6-15-2025 Required Installment $750

Payment 6-15-2025 $500

Used 4-15-2025 ($250) ($250)

Underpayment $500

Paid 9-15-2025 ($500)

-0-

6-15-2025 to 9-15-2025 = 92 days

Second Quarter Penalty......$13

92/365 X .10 x $500 = $13

Column (c) 9-15-2025 Required Installment

$750

Payment 9-15-2025 $500

Used 6-15-2025 ($500) -0-

Underpayment ($750)

Paid 1-15-2026 $500

Paid 4-15-2026 $250 ($750)

-0-

9-15-2025 to 1-15-2026 = 122 days

NOOLPSR u KNM u ARMM Z ANT

9-15-2025 to 4-15-2026 = 212 days

ONOLPSR u KNM u AORM Z ANR Third Quarter Penalty..........$32 Column (d) 1-15-2026 Required Installment

$750

Payment $500

Used 9-15-2025 ($500) -0-

Underpayment

$750

Paid 4-15-2026 ($750)

-0-

1-15-2026 to 4-15-2026 = 90 days

90/365 X .10 x $750 = $18

Fourth Quarter Penalty........$18

Total Penalty......................$67 AR2210 Inst. Page 2 (R 6/27/2025)