- Instruction Year: 2023
Learn About the IA 2210 Form
The IA 2210 penalty is calculated as a per day interest charge based upon the number of days that an estimated income tax payment is made after the required due date.
The first 9 lines of the 2210 form determine how much tax the taxpayer should have paid.
The second part of the 2210 form determines what the penalty, if any, is on the tax that was not paid. Penalty is determined on a quarterly basis.
Either the IA 2210 or IA 2210S is used to determine if an individual taxpayer paid income tax sufficiently throughout the year. This form is used to calculate any penalty due.
You may use the short method (IA 2210S) for 2210 penalty if:
- You did not make any estimated payments, or
- You paid the same amount of estimated tax on each of the four payment due dates.
You must use the regular method (IA 2210) to calculate your 2210 penalty if:
- You made any estimated tax payments late,
- You choose to annualize your income for 2210 penalty calculations.
Note: If any payment was made earlier than the due date for that payment, you may use the short method, but using it may cause you to pay a larger penalty than the regular method. If the payment was only a few days early, the difference is likely to be small.
To find out if you owe 2210 penalty, complete the IA 1040 through line 34 then complete the IA 2210 or IA 2210S. You will need the amount of tax you paid Iowa in 2022 in addition to completing the 2023 Iowa return.
Taxpayers who do not have Iowa tax withheld from their paychecks must pay Iowa tax on their income by making Iowa estimated tax payments on a quarterly basis.
Estimated Payments
If you file returns on a calendar-year basis and are required to file form IA 1040ES, you are generally required to pay the tax in four installments with the first installment due by April 30.
If you file returns on a fiscal-year basis and are required to make estimated income tax payments, you are generally required to pay the tax in four installments with the first installment due the last day of the fourth month after the filing year ends.
You may benefit by using the IA 2210 Schedule AI (45-011) Annualized Income Installment Method if your income varied during the year.
Calendar-Year Taxpayers: If you are not required to file estimated payments until later in the year because of a change in your income or exemptions, you may be required to pay in fewer installments.
IA 2210 Schedule AI Information
Nonresident or Part-Year Resident Credit: This credit must be computed on the IA 126 for each period as follows:
- Figure the Iowa-source gross income less any adjustments for the period. Multiply this income figure by the number for the corresponding period on Schedule AI, line 2 and enter on the IA 126, line 25.
- Enter the amount from Schedule AI, line 3 on the IA 126, line 26.
- Calculate the Iowa income percentage and the nonresident/part-year resident credit percentage on the IA 126, lines 27 and 28.
- Enter the tax amount for the period from Schedule AI, line 4 on the IA 126, line 29.
- Add the credits from Schedule AI, lines 7 and 8 that represent IA 1040, lines 8, 9, and 10. Enter this figure on form IA 126, line 30.
- Compute the nonresident/part-year resident credit by subtracting the credits on IA 126, line 30, from the tax on IA 126, line 29. Multiply this amount by the percentage on line 28. Enter this number on Schedule AI, line 8.
Out-of-State Tax Credit form IA 130 must be computed for each period:
The gross income taxed by the other state/country, IA 130, line 13, must be annualized by multiplying by the annualization factor for the period. The gross income for residents, IA 130, line 16, is the amount on Iowa Schedule AI, line 3, (if a part-year resident, the amount is taken from IA 126, line 13) for the period. The tax, IA 130, line 18, is the amount on Iowa Schedule AI, line 4 for the period. The total tax imposed by the other state/country must be multiplied by a ratio of gross income taxed by the other state/country for the period to total gross income taxed by the other state/country.
Example: Fred, a full-year resident, had $100,000 of income taxed by another state. The other state’s tax imposed was $4,000 for the year. For the period 1/1/23 to 3/31/23, the income taxed by the other state was $25,000. The computation for the tax imposed for the period 1/1/23 to 3/31/23 is ($4,000 times the annualization factor of 4.0 X 25,000/100,000).
Please include a worksheet or tax form showing the calculations for each credit claimed on line 8.
Estimated / Installment Payment Periods and Due Dates
The chart below shows the due date for the calendar year filers installments and the maximum number of installments required for each. More installments than required may be made in each period.
| Period Requirement First Met | Installment is Due | Maximum Number of Installments Required During the Year |
|---|---|---|
| Between January 1 and April 1 | April 30 | 4 |
| Between April 2 and June 1 | June 30 | 3 |
| Between June 2 and September 1 | September 30 | 2 |
| After September 1 | January 31 | 1 |
If the due date falls on a Saturday, Sunday, or holiday as defined in Iowa Code section 421.9A, then the due date is the following day that is not a Saturday, Sunday, or holiday.
Fiscal-year filers: If you file returns on a fiscal-year basis and are required to make estimated income tax payments, you are generally required to pay the tax in four installments with the first installment due the last day of the fourth month after the filing year ends. Subsequent installment due dates would fall on the last day of the sixth month, last day of the ninth month, and last day of the first month of the next fiscal year.
Basic IA 2210 Calculation Criteria
- Installment period due dates are important. When a due date is missed, penalty applies in most cases.
- Payments are first carried back to any prior period with an underpayment.
- Any overpayments are carried forward to the next period.
- Any credit carryforward from the prior year is applied to the April 30 installment.
- There may be more than one penalty calculation for an installment period if more than one payment was made in that period.
- Iowa tax withholding is credited equally in each installment period.
Examples
IA 2210 Example 1
An individual taxpayer did not make any estimated payments of Iowa income tax throughout the year. The taxpayer paid $4,000 when filing the tax return on April 30.
Results: The taxpayer should have paid $1,000 each quarter, for a total of $4,000 for the entire year. This taxpayer owes 2210 penalty.
IA 2210 Example 2
An individual taxpayer made four estimated payments of Iowa income tax for a total of $4,000. Although the full amount was eventually paid, some payments were not timely.
Results: This taxpayer owes 2210 penalty. Why? It matters when the payments are made. If they are not timely, a penalty is due.
First installment period (due April 30): No payment was made by April 30; therefore, the taxpayer has a $1,000 underpayment and will be assessed penalty.
- The first payment of the year ($500) was made June 15. The second ($2,000) was two weeks later on June 30.
- The underpayment is paid by applying the $500 paid June 15 and $500 of the $2,000 paid June 30.
- The $500 paid June 15 has a penalty for 46 days (May 1 - June 15). The $500 paid June 30 has a penalty for 61 days (May 1 - June 30).
Second installment period (due June 30): No penalty is charged for this period.
- The taxpayer had $1,500 remaining from the $2,000 paid June 30 to apply to this period.
- Of the remaining $1,500, $500 is carried forward to the next installment.
Third installment period (due September 30): Penalty is charged for this period. $500 of the June 30 payment carried over to this period; therefore, the taxpayer still owes $500 for this period.
- The taxpayer's third payment of $500 is made January 31, too late for the third period. This amount is applied to the third period.
- Penalty on this $500 is for 92 days for the October 1 - December 31 quarter AND 31 days for January 1 - 31.
Fourth installment period (due January 31): Since the taxpayer's January 31 payment applied to the third installment, penalty is due on $1,000.
- The $1,000 payment made February 25, is applied to this period's underpayment.
- Penalty on the $1,000 is for 25 days for February 1 - February 25.
IA 2210S Example 1
An individual taxpayer did not make any estimated payments of Iowa income tax throughout the year.
Results: The taxpayer should have paid $1,000 each quarter, for a total of $4,000 for the entire year. This taxpayer owes 2210 penalty.
IA 2210S Example 2
An individual’s tax liability determined on the IA 1040 was $4,000. The individual made four estimated payments of Iowa income tax during the year in the amount of $500 each, for a total of $2,000. Payment of the remaining $2,000 due was made on April 15.
Results: All payments were made on time, but the taxpayer should have made a total of $4,000 in estimated payments of Iowa income tax. This taxpayer owes 2210 penalty.