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A taxpayer expects to owe $750 to the State at the end of the year based off of estimates, which is the difference between their
A taxpayer expects to owe $750 to the State at the end of the year based off of estimates, which is the difference between their known withholdings of $5,750 and their estimated tax liability of $6,500. Their tax liabilities for the prior year were $6,000. Their witholdings throughout the year will be equally dispersed. How much in estimated payments, total, should they make during the year in order to avoid underpayment penalties? (Choose the lowest correct answer. Also, their AGI for this question is under $100,000 and they are not MFS.) Nothing; Current withholding estimates are acceptable because the balance owed will be less than $1,000 during the year. $100; This would equal 90% of the anticipated balance due and avoid underpayment penalties. $250; This would equal 100% of the prior year liability and avoid underpayment penalties. $750; It's just better not to owe
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