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New Mexico Calculation of Estimated CIT Penalty Interest on Underpayment
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Extracted from PDF file 2023-new-mexico-form-rpd-41287.pdf, last modified March 2023Calculation of Estimated CIT Penalty Interest on Underpayment
RPD-41287 (2023) Rev. 04/01/2023 New Mexico Taxation and Revenue Department 2023 Calculation of Estimated Corporate Income Tax — Method 4 Penalty and Interest on Underpayment (1 of 4) PURPOSE OF THIS FORM: If you calculate estimated corporate income tax payments using Method 4, pursuant to Section 7-2A-9.1 NMSA 1978, and by using Method 4, you can reduce the amount of penalty and interest on the underpayment of estimated corporate income tax you owe instead of using the lower of Method 1, 2, or 3, complete this form and attach it to your CIT-1 return. For more information on the methods and whether your corporation qualifies to use Method 4, see Determine the Amount of Your Quarterly Estimated Tax Payment and Restrictions on Methods of Computing the Installment Payment Due on page 3 of the instructions. When using Method 4, you must mark the box on CIT-1, page 2, line 26a, and attach this form to your return. The Department will compute any underpayment penalty and interest due, if any, using the lower of Method 1, 2, or 3 and issue you an assessment of penalty and interest for underpayment of estimated tax. Print your company’s name Enter your federal employer identification number (FEIN) Section 1. Calculate the estimated installment payment due for each quarter using Method 4 and calculate the underpayment for each quarter. Using the instructions for this form, complete the schedule below to calculate underpayment of estimated corporate income tax. Complete lines 1 through 8 for each quarter of your tax year. 1st Quarter NOTE: If your corporate income tax less credits for the current taxable year is less than $5,000, don’t file this form. You don’t owe quarterly estimated tax. 1. For each quarter, enter the due date of the quarterly estimated installment tax payment. Use the 4th, 6th, 9th, and 12th month of the corporation’s tax year. (a) 1. 2. Enter the New Mexico net taxable income earned in the corresponding quarter. (The portion of CIT-1, line 9, earned in each quarter.) 2. 3. Enter the net New Mexico corporate income tax due (the portion of CIT-1, line 14) for the corresponding quarter. If less than zero, enter zero. 3. 4. For each quarter, multiply line 3 by 80% (0.80) and enter here. This is the estimated installment tax payment due. 4. 5. For each quarter, enter the estimated tax payments made on or before the due date of the installment tax payment. Include payments of tax withheld. See the instructions. 5. 6. Subtract line 5 from line 4 and enter here. This is the underpayment for the quarter as of the due date of the installment tax payment. 6. 7. For each quarter, enter any estimated tax payments made after the due date of the installment tax payment. 7. 8. Add lines 5 and 7 and enter here. This is the total estimated tax paid for the current quarter. 8. 2nd Quarter 3rd Quarter (b) (c) 4th Quarter (d) New Mexico Taxation and Revenue Department RPD-41287 (2023) Rev. 04/01/2023 2023 Calculation of Estimated Corporate Income Tax — Method 4 Penalty and Interest on Underpayment (2 of 4) Section 2. List each estimated tax payment made. Complete the list below recording the amount of each estimated tax payment and the postmark date of each estimated tax payment. Include any carryforward from a previous return. In column (c), enter the quarter paid as indicated with the payment. If the payment was a carryforward from the prior-year return, write carryforward. If the federal employer identification number (FEIN) used at the time of the payment is different from the number on your income tax return, enter the federal employer identification number (FEIN) indicated at the time of payment. The sum of estimated tax payments in Section 1, line 8, must equal the estimated tax payments listed below. (a) (b) Amount of payment Postmark date (c) Indicate the quarter paid as reported at the time of the payment or whether the payment is from a carryforward (d) FEIN, if different Section 3. Option to have the Department compute the penalty and interest on underpayment of estimated corporate income tax using Method 4. Mark this box if you want the Department to compute the penalty and interest on underpayment of estimated corporate income tax using Method 4. You must submit completed Sections 1 and 2 or the Department can’t calculate your penalty and interest using Method 4, and penalty and interest will be assessed based on the lower of Methods 1, 2, or 3. To compute the penalty and interest on underpayment of estimated corporate income tax, continue to the next page. RPD-41287 (2023) Rev. 04/01/2023 New Mexico Taxation and Revenue Department 2023 Calculation of Estimated Corporate Income Tax — Method 4 Penalty and Interest on Underpayment (3 of 4) Section 4: Compute the penalty and interest on underpayment of estimated installment payments. Complete this section to calculate the penalty and interest you owe. At the top of the column indicate the quarter (1, 2, 3, or 4) in which an underpayment occurred from Section 1, line 6. If you have multiple late payments in one quarter, add extra columns for each payment or part of a payment that was applied to the quarter. Calculate each late payment for a quarter in a separate column. See the instructions for more information. __ Quarter __ Quarter __ Quarter __ Quarter __ Quarter __ Quarter __ Quarter __ Quarter (a) 9. Enter the underpayment of estimated tax for the quarter indicated at the top of the column, from Section 1, line 6. 9. 10. Enter the due date of the installment from Section 1, line 1. 10. 11. Enter the date of the payment or the due date of the return, whichever is earlier (see instructions). Include only payments made after the due date of the installment payment, included on line 7, Section 1. 11. 12. Number of days from the due date of the installment (line 10) to the date shown on line 11. 12. 13. Number of days on line 12, after 4/15/2022 and before 7/1/2022. 13. 4 14. Underpayment on line 9 X Number of days on line 13 X ____% = 365 14. 15. Number of days on line 12, after 6/30/2022 and before 10/1/2022. 15. 5 16. Underpayment on line 9 X Number of days on line 15 X ____% = 365 16. 17. Number of days on line 12, after 9/30/2022 and before 1/1/2023. 17. 6 18. Underpayment on line 9 X Number of days on line 17 X ____% = 365 18. 19. Number of days on line 12, after 12/31/2022 and before 4/1/2023. 19. 7 20. Underpayment on line 9 X Number of days on line 19 X ____% = 365 20. (b) (c) (d) (e) (continue on the next page) (f) (g) (h) RPD-41287 (2023) Rev. 04/01/2023 New Mexico Taxation and Revenue Department 2023 Calculation of Estimated Corporate Income Tax — Method 4 Penalty and Interest on Underpayment (4 of 4) Section 4: continued 21. Number of days on line 12 after 3/31/2023 and before 7/1/2023. 21. 7 %= 22. Underpayment on line 9 X Number of days on line 21 X ____ 365 22. 23. Number of days on line 12, after 6/30/2023 and before 10/1/2023. 23. 24. Underpayment on line 9 X Number of days on line 23 X ____% = 365 24. 25. Number of days on line 12, after 9/30/2023 and before 1/1/2024. 25. 26. Underpayment on line 9 X Number of days on line 25 X ____% = 365 26. 27. Number of days on line 12, after 12/31/2023 and before 4/1/2024. 27. 28. Underpayment on line 9 X Number of days on line 27 X ____% = 365 28. 29. For each column, add lines 14, 16, 18, 20, 22, 24, 26, and 28. 29. 30. Add line 29, columns (a) through (h) and enter the total here. This is your total interest on underpayment of estimated income tax. 30. 31. Penalty. Multiply the underpayment from line 9 by the number of months or partial months that the payment was not made by 0.02, not to exceed 20% of the amount of underpayment. A month begins on the day after the due date of the installment payment and 31. ends on the 15th of each subsequent month. 32. Total Penalty. Enter the sum of columns (a) through (h) on line 31. This is the total penalty due on underpayment of estimated corporate income tax. 32. __ Quarter __ Quarter __ Quarter __ Quarter __ Quarter __ Quarter __ Quarter __ Quarter (a) (b) (c) (d) (e) (f) (g) (h) RPD-41287 (2023) Rev. 04/01/2023 New Mexico Taxation and Revenue Department 2023 Calculation of Estimated Corporate Income Tax — Method 4 Penalty and Interest on Underpayment Instructions (1 of 3) WHO MUST FILE Every corporation subject to the corporate income tax shall pay estimated corporate income tax if its tax after applicable credits is $5,000 or more in the current tax year. If the taxable liability for the tax year is less than $5,000, estimated corporate income tax payments aren’t required. Estimated penalty and interest are assessed on the difference between the estimated payments and the amount of estimated tax due, computed using the lower of Method 1, 2, 3, or 4. The Department automatically computes estimated payments using the lower of Methods 1, 2, or 3. To use Method 4, you must attach a completed RPD-41287, Calculation of Estimated Corporate Income Method 4 Tax Penalty and Interest on Underpayment, and mark box 26a on CIT-1, page 2. For a description of Methods 1, 2, 3, and 4 for calculating the underpayment penalty and interest, see Determine The Amount Of Your Quarterly Estimated Tax Payment on page 3 of these instructions. See also the instructions for CIT-ES, Corporate Income and Franchise Estimated Tax Payment Voucher. HOW TO COMPLETE THE FORM Section 1: Calculate the estimated installment tax payment due for each quarter using Method 4 and calculate the underpayment for each quarter. Calculating estimated tax using Method 4 requires that you compute corporate income tax due, net of any tax credit applied to the tax due, for each quarter of the current taxable year. The amount of the installment tax payment due for each quarter is 80% of the tax due for that quarter. The installment tax payments are due on or before the 15th day of the 4th, 6th, 9th, and 12th month of the tax year. Important: The Department does observe Federal and State holidays, this may impact the due dates for returns and payments. If the due date falls on a Saturday, Sunday, or a Federal/State holiday the due date is the next business day. Requesting the Department to calculate penalty and interest on underpayment of estimated corporate income tax using Method 4. If you want the Department to compute the penalty and interest on underpayment of estimated corporate income tax using Method 4, mark the box in Section at the bottom of RPD-41287. Next, complete Sections 1 and 2 only, and then mark box 26a on CIT-1, page 2, and submit RPD-41287 with your CIT-1. Line 1. For each quarter enter the due date of the quarterly estimated installment tax payment. Enter the 15th day of the 4th, 6th, 9th, and 12th month of the tax year. For calendar-year taxpayers, the due dates are Apr.15; June 15; Sept.15; and Dec. 15. Line 2. Enter the New Mexico net taxable income earned in the corresponding quarter. The New Mexico net taxable income for each quarter is the portion of the amount entered on CIT-1, line 9, earned in the applicable quarter. The amount is the net taxable income earned for the quarter, before applying the New Mexico percentage. Line 3. For each quarter, enter the net New Mexico corporate income tax due for the corresponding fiscal quarter. If less than zero, enter zero. The corporate income tax due for each quarter is based on the income earned during the fiscal quarter after applying the New Mexico percentage, less allowable credits. Line 4. To complete line 4 for each quarter, multiply line 3 of the corresponding column by 80% (0.80). This is the estimated installment tax payment due. Line 5. Record the sum of all timely estimated tax payments made or credited to each quarter, not to exceed the underpayment reported on line 4. Include only payments made on or before the due date of the installment payment. Include any carryforwards from previous tax year returns in the first quarter installment payment. Include overpayments of a prior quarter installment payment that’s applied to the current installment payment. Also include tax withheld. Include only timely installment payments made on or before the date the installment payment is due (line 1). Report payments made after each quarterly due date for the current quarter on line 7. How Installment Payments Are Applied An installment payment of estimated tax is first applied to the quarter as directed by the taxpayer. You can only apply an overpayment of an installment payment to a prior quarter or a later quarter installment payment when it exceeds the amount due for the quarter indicated on the payment. Including Tax Withheld The amount of tax withheld under the Withholding Tax Act [Section 7-3-1 NMSA 1978] or the Oil and Gas Proceeds and Pass-Through Entity Withholding Tax Act [Section 7-3A-1 NMSA 1978] shall be deemed a payment of estimated tax. An equal amount of the tax withheld is deemed paid on each quarterly payment RPD-41287 (2023) Rev. 04/01/2023 New Mexico Taxation and Revenue Department 2023 Calculation of Estimated Corporate Income Tax — Method 4 Penalty and Interest on Underpayment Instructions (2 of 3) due date unless the taxpayer establishes the dates on which all amounts were actually withheld, in which case the amounts withheld shall be deemed payments of estimated tax on the due dates on which the amounts were actually withheld. Line 6. Calculate any underpayment as of the due date of the installment tax payment for each quarter by subtracting line 5 from line 4. Line 7. Record the sum of all estimated installment tax payments made against each quarter that was paid after the due date of the installment tax payment. Line 8. For each column, add the amounts on lines 5 and 7. Make sure the total of all line 8 columns equals the total estimated tax payments made or credited for the 2023 tax year and also equals the sum of all estimated payments listed in Section 2. Section 2: List each estimated tax payment made or credited to the tax year. Enter the amount of each estimated tax payment made and the postmark of the payment. If it was a carryforward from a previous tax return, enter carryforward in column (c), and indicate the quarter for which the estimated tax payment was made. Enter 1, 2, 3, or 4, as originally indicated on the payment voucher. If one or more payments were submitted to the Department under an incorrect federal employer identification number (FEIN), provide the FEIN as originally submitted with the payment. Section 3: Option to have the Department to compute the penalty and interest on underpayment of estimated corporate income tax using Method 4. If you want the Department to compute the penalty and interest on underpayment of estimated corporate income tax using Method 4, mark the box in Section 3 at the bottom of RPD-41287, page 2. Next, complete Sections 1 and 2 only, and then mark the box 26a on CIT-1, page 2, and submit RPD-41287 with your CIT-1. You don’t need to complete Section 4. Section 4: Compute the penalty and interest on underpayment of estimated installment tax payments. Don’t complete this section if you want the Department to compute the penalty and interest on underpayment of estimated corporate income tax. Please mark the box in Section 3 and follow the directions for filing this form. At the top of the column, indicate the quarter (1, 2, 3, or 4) of an underpayment from Section 1, line 6. If you have multiple late payments in one quarter, add extra columns for each payment or part of a payment that was applied to the quarter. Calculate each late payment for a quarter in a separate column. If no underpayment of estimated tax payment is recorded on Section 1, line 6, for a quarter, you don’t need to complete a column for that quarter. Line 9. Enter the underpaid amount of the estimated installment payment due as of the due date of the installment payment (from Section 1, line 6). Do this even if multiple late payments have been made for the quarter listed at the top of the column. If multiple payments were made after the due date of the installment payment for any quarter, enter each late payment for a quarter in a separate column. When completing line 9 for subsequent columns for the same quarter, subtract the previous late payment(s) for the quarter from the underpayment for the quarter as of the due date of the installment tax payment. If a late payment for this quarter has not been made, or is paid in one payment, enter the underpayment for the quarter from Section 1, line 6. Line 10. Enter the date the installment payment was due (from Section 1, line 1). Line 11. Enter the date the late installment payment was made or the due date of the return, whichever is earlier. Include only payments made after the due date of the installment payment. General Instructions For Lines 12 Through 30, Columns (a) Through (h) Lines 13, 15, 17, 19, 21, 23, 25, and 27. Enter the number of days from the beginning of the calculation period to the date the underpayment was paid or the last day of the calculation period, whichever is earlier. The calculation period is defined on the form. For example, line 13, identifies the calculation period as after 04/15 and before 07/01. The calculation periods coincide with calendar year quarters. Lines 14, 16, 18, 20, 22, 24, 26, and 28. Calculate interest due during the calculation period by performing the computation as indicated on the form. If the annual interest rate is blank, then the annual interest rate for the quarter was not announced by the IRS when this form was published. Check the Department RPD-41287 (2023) Rev. 04/01/2023 New Mexico Taxation and Revenue Department 2023 Calculation of Estimated Corporate Income Tax — Method 4 Penalty and Interest on Underpayment Instructions (2 of 3) website for a current list of the applicable interest rates. The IRS doesn’t announce interest rates until the month prior to the beginning of each quarter. Line 29. For each column, add lines 14, 16, 18, 20, 22, 24, 26, and 28 and enter the sum in the respective column. Line 30. Enter the sum of line 29, columns (a) through (d). This is the total interest on underpayment of estimated income tax. Lines 31 and 32. Compute the penalty on underpayment of estimated installment payments. If you want the Department to compute the penalty and interest on underpayment of estimated corporate income tax using Method 4, mark the box in Section 3, at the bottom of RPD-41287, page 2. Next, complete Sections 1 and 2 only, and then mark the box 26a on CIT-1, page 2, and submit RPD-41287 with your CIT-1. You don’t need to complete Section 4. Line 31. Multiply by 0.02 the underpayment from line 9 of the corresponding column by the number of months or partial months* within the calculation period that the underpayment was unpaid. The calculation period for computing penalty is the period on RPD-41287, page 3, between lines 10 and 11. The formula for computing penalty is: Underpayment x number of full/partial months x 0.02 * Compute the number of full/partial months within the calculation period that the underpayment on line 9 remains unpaid. To calculate months or partial months, begin counting on the day after the due date of the estimated installment tax payment. Payments received the day after the due date of the installment tax payment are paid one partial month late. Add one month for each 15th of the month that passes before the payment is made. Don’t count months or partial months after the due date of the return. Line 32. Enter the sum of line 31, columns (a) through (h). This is the total penalty on underpayment of estimated income tax. Determine The Amount Of Your Quarterly Estimated Tax Payment To avoid penalty and interest for underpayment of estimated tax, calculate the estimated tax by one of the following methods: • Method 1. 80% of the current year’s estimated tax liability. • Method 2. 100% of the previous year’s tax liability, if it’s a full 12-month year. • Method 3. 110% of the liability for the year immediately preceding the previous tax year, if it’s a full 12-month tax year and the return for the previous tax year hasn’t been filed, and the extended due date for filing the return for the previous tax year hasn’t occurred at the time the first estimated payment installment of the current tax year is due. • Method 4. 80% of the estimated tax liability for each quarter of the current tax year calculated on a period-by-period basis, not accumulative. When using Methods 1, 2, or 3, estimated tax must be paid in four installments equal to 25% of the estimated tax. Method 4 requires an installment of 100% of the estimated tax payment calculated for the quarter. Use the corporate income tax rates in the Instructions for Form CIT-1 to estimate your income tax liability. Restrictions On Methods Of Computing The Installment Payment Due • Method 2. Use only (a) if a corporate tax return was filed for the immediate prior year, and (b) such prior year was a full 12-month or a 52/53-week year. • Method 3. Use only if the tax year immediately preceding the previous tax year was a full 12-month year, the return for the previous tax year hasn’t been filed, and the extended due date for filing that return hasn’t occurred at the time the first installment is due. • Method 4. Taxpayers whose corporate income tax less credits for the current tax year is $5,000 or greater and whose income is seasonal or varied throughout the year may use Method 4 to adjust required payments due for each fiscal quarter based on actual income received. If you owe penalty and interest on underpayment of estimated corporate income tax using the lowest of Methods 1, 2, or 3, and Method 4 applies, you may further lower the amount of penalty and interest you owe by using Method 4.
Form RPD-41287
More about the New Mexico Form RPD-41287 Individual Income Tax TY 2023
Every corporation must file the Corporate Income Tax of the applicable credit on the estimated income is $5000 or more in the tax year. If the income tax estimates are less than $5000, then this form is not required
We last updated the Calculation of Estimated CIT Penalty Interest on Underpayment in April 2023, so this is the latest version of Form RPD-41287, fully updated for tax year 2023. You can download or print current or past-year PDFs of Form RPD-41287 directly from TaxFormFinder. You can print other New Mexico tax forms here.
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TaxFormFinder has an additional 80 New Mexico income tax forms that you may need, plus all federal income tax forms.
| Form Code | Form Name |
|---|---|
| Form PIT-ES | Estimated Payment Voucher |
| Form PIT-1 | Personal Income Tax Return |
| Form PIT-RC | Rebate & Credit Schedule |
| Form PIT-ADJ | Schedule of Additions & Deductions and Exemptions |
| Income Tax Instructions | Individual Income Tax Instructions |
View all 81 New Mexico Income Tax Forms
Form Sources:
New Mexico usually releases forms for the current tax year between January and April. We last updated New Mexico Form RPD-41287 from the Taxation and Revenue Department in April 2023.
About the Individual Income Tax
The IRS and most states collect a personal income tax, which is paid throughout the year via tax withholding or estimated income tax payments.
Most taxpayers are required to file a yearly income tax return in April to both the Internal Revenue Service and their state's revenue department, which will result in either a tax refund of excess withheld income or a tax payment if the withholding does not cover the taxpayer's entire liability. Every taxpayer's situation is different - please consult a CPA or licensed tax preparer to ensure that you are filing the correct tax forms!
Historical Past-Year Versions of New Mexico Form RPD-41287
We have a total of two past-year versions of Form RPD-41287 in the TaxFormFinder archives, including for the previous tax year. Download past year versions of this tax form as PDFs here:
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