What is the minimum amount of estimated tax that I am required to pay without incurring any penalty or interest charges?
In general, you may owe a penalty for 2003 if the total of your withholding and estimated tax payments did not equal at least the smaller of: • 90% of your 2003 tax (current year tax), or • 100% of your 2002 tax (prior year tax). (Your 2002 tax return must cover a 12-month period.) Your 2003 tax, for this purpose, is your Total tax for 2003. There are special rules for farmers and fishermen, and for certain higher income taxpayers. Generally, you do not have to pay an underpayment penalty if either of the following conditions apply: • Your total tax is less than $1,000, (less withholding and credits) or • You had no tax liability last year. Farmers and fishermen. If at least two-thirds of your gross income for 2002 or 2003 is from farming or fishing, you are required to make one installment equal to 66 2 /3% of your 2003 tax (current year tax). Higher income taxpayers. If less than two-thirds of your gross income for 2003 or 2002 is from farming or fishing and your adjusted gross incom
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