West Virginia Code of State Rules › Agency 110 - Tax › Title 110 - LEGISLATIVE RULE STATE TAX DEPARTMENT › Series 110-24 - Corporation Net Income Tax › Section 110-24-27 - "Safety Zones" Bar Imposition Of Additions To Tax For Underpayment Of Estimated Tax

Current through Register Vol. XLI, No. 28, July 12, 2024
27.1. In
				General. - Additions to tax will not be imposed for any underpayment of any
				installment of estimated tax if, on or before the date prescribed for payment
				of the installment (determined with regard to any authorized extension of time
				for payment), the total amount of all payments of estimated tax made equals or
				exceeds the least of the amounts due under "Safety zones" set forth in this
				section.
27.1.a. Safety zone 27.1.a.. - The
				amount of tax due with the annual return is five hundred dollars ($500) or
				less.
27.1.b. Safety zone 27.1.b.-
				The amount of tax due with the annual return is ten percent (10%) or less of
				the tax liability for the taxable year.
27.1.c. Safety zone. B For tax years
				beginning on or after January 1, 2010 -- The amount of tax which would be due
				if computed using current year rates, exemptions, and credits rather than being
				based on the facts and law applicable to the West Virginia corporation net
				income tax return for the preceding year. This safety zone avoids additions to
				tax if the total payments of estimated tax already made by the installment date
				are at least equal to an amount which would have been required on that
				installment date if the estimated tax was determined based on the facts shown
				on the previous year's return and the previous year's law, but using current
				year rates, exemptions, and credits. In this safety zone, the following rules
				apply:
27.1.c.1. Nonrecurring items of income
				and deductions are not to be excluded; and
27.1.c.2. An entity that did not file a West
				Virginia corporation net income tax return for the preceding tax year cannot
				use this safety zone.
27.1.d. Application of safety zones to short
				tax years. B For purposes of this subsection and subsection 27.2. of this rule,
				additions to tax for an underpayment of estimated tax are equally applicable to
				short tax years where a declaration of estimated tax is required to be filed.
				In computing the safety zones for short taxable years, the estimated tax
				(whether based on that shown on the previous year's return, based on the
				previous year's facts, or based on annualized current income) is reduced by
				multiplying the estimated tax for a full year by the percentage which the
				number of months in the short tax year bears to twelve (12).
27.1.e. For purposes of this subsection and
				subsection 27.2. of this rule, if the tax rates for the current year have
				changed from those in effect for the preceding year, the estimated tax shall be
				computed using current rates.
27.1.f. Safety zone requirements. - For
				purposes of this subsection and subsection 27.2. of this rule, safety zone
				requirements shall be satisfied on each installment date to avoid the
				imposition of additions to tax on an underpayment of estimated tax as of the
				installment date. For purposes of this rule, it is presumed that a taxpayer's
				West Virginia taxable income is received in equal installments throughout the
				taxable year. The taxpayer bears the burden of proof to establish that the West
				Virginia taxable income was received during the taxable year in some other
				manner.