Form 1120-W, Estimated Tax for Corporations
Corporations use IRS Form 1120-W to estimate their tax liability and determine the amount of their quarterly estimated tax payments. Form 1120-W is a worksheet and should not be filed with the IRS. Corporations should keep completed forms for their business records.
Who Should Use Form 1120-W
Corporations with an estimated tax (income tax minus credits) of $500 or more must generally make estimated tax payments. If your company falls into this category, it should use Form 1120-W to determine its quarterly payments. S corporations, however, should use Form 1120-S, U.S. Income Tax Return for an S Corporation, to figure their estimated tax payments.
Estimated tax payments are generally due by the 15th day of the 4th, 6th, 9th, and last month of the tax year. If the date falls on a Saturday, Sunday, or legal holiday, the payment is due the next regular business day.
How to Complete Form 1120-W
All line references on Form 1120-W instructions are specific to IRS Form 1120, U.S. Corporation Income Tax Return. Any other entity using this form to determine estimated tax payments should refer to the applicable line from their income tax return and the maximum rate that is in effect for their applicable tax year.
Lines 1 & 2. Multiply your expected taxable income from line 1 by 21% and enter the amount on line 2.
Line 3. See instructions for Form 1120, Schedule J, Part I, lines 5a through 5e. Enter tax credits here.
Line 4. Subtract line 3 from line 2 and enter the total here.
Line 5. See instructions for Form 1120, Schedule J, Part 1, line 9, and enter other taxes here.
Line 6. Enter the total of line 4 and line 5 combined on this line.
Line 7. See Form 4136, Credit for Federal Tax Paid on Fuels, to see if the corporation qualifies for this credit. Include any other refundable credit amount (see Form 1120, Schedule J instructions) on this line.
Line 8. Subtract line 7 from line 6. If the amount is less than $500, you do not have to make estimated tax payments.
Line 9a & 9b. For line 9a, figure the corporation’s tax in the same way that line 8 of this worksheet was figured, using the taxes and credits from the income tax return. If a tax return was not filed for the tax year showing a liability for at least some amount of tax or the tax year was for less than 12 months, do not use line 9a. Instead, enter the amount from line 8 on line 9b.
Line 10. Enter the quarterly payment dates for the 4th, 6th, 9th, and 12th months of either the calendar or fiscal tax year.
Line 11. Enter 25% of line 9b in each of the columns (a-d).
If the corporation uses either the annualized income installment method or the adjusted seasonal installment method, it must complete Schedule A (Form 1120-W) to determine its estimated tax payment amount.
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