INSTRUCTIONS: ARKANSAS PENALTY FOR UNDERPAYMENT OF ESTIMATED TAX (Form AR2210)
To calculate the penalty owed for underpayment of estimated Arkansas tax, a form AR2210 can be used. Taxpayers with variable income may benefit by calculating the penalty owed on an annualized basis using a form AR2210A. Both documents can be obtained from the website maintained by the Arkansas Department of Finance and Administration.
Arkansas Penalty For Underpayment Of Estimated Tax AR2210 Step 1: In the first blank box, enter your name.
Arkansas Penalty For Underpayment Of Estimated Tax AR2210 Step 2: In the second blank box, enter your Social Security number.
Arkansas Penalty For Underpayment Of Estimated Tax AR2210 Step 3: Review the information regarding exceptions on the second page. If any apply, enter their number in Part I and do not complete the rest of the form. Otherwise, complete Part II.
Arkansas Penalty For Underpayment Of Estimated Tax AR2210 Step 4: Enter your tax year's net tax on line 1.
Arkansas Penalty For Underpayment Of Estimated Tax AR2210 Step 5: Multiply line 1 by 0.9. Enter the resulting product on line 2.
Arkansas Penalty For Underpayment Of Estimated Tax AR2210 Step 6: Enter your tax year Arkansas income tax withheld on line 3.
Arkansas Penalty For Underpayment Of Estimated Tax AR2210 Step 7: Subtract line 3 from line 1. Enter the resulting difference on line 4. If the result is $1,000 or less, do not complete the rest of the form.
Arkansas Penalty For Underpayment Of Estimated Tax AR2210 Step 8: Enter your previous tax year's net tax on line 5.
Arkansas Penalty For Underpayment Of Estimated Tax AR2210 Step 9: Enter the smaller of line 2 or line 5 on line 6.
Arkansas Penalty For Underpayment Of Estimated Tax AR2210 Step 10: If line 6 is greater than line 3, you must complete Part III, which concerns computation of your penalty owed. In all 4 columns of line 7, enter a quarter of the value on line 6. These are your required installment payments for each quarter.
Arkansas Penalty For Underpayment Of Estimated Tax AR2210 Step 11: Complete lines 8 through 18 as directed to determine how you much have underpaid or overpaid. Examples of how to compute penalties owed are provided on the second page.
