Instructions for Corporate Estimated Tax (Form 1120-W)

Corporate Estimated Tax Planner

Plan Your Corporate Tax Payments Strategically

This tool helps corporations, including S-corps and tax-exempts, calculate their required estimated tax payments. Avoid penalties and manage cash flow by using methods tailored to your business's income stream.

Step 1: Determine Your Required Annual Payment

First, find the total amount you need to pay for the year. The IRS requires you to pay the lesser of 100% of your current year's tax or 100% of your prior year's tax to avoid a penalty.

2021 Total Tax

Expected 2022 Total Tax

Your Required Annual Payment is:

$0.00

Note: "Large corporations" ($1M+ taxable income) have special rules and must generally use 100% of the current year's tax.

Step 2: Choose Your Payment Strategy

Once you know your total required payment, choose a method for your quarterly installments. This choice can significantly impact your company's cash flow.

Standard & Simple: Four Equal Payments

This is the simplest method. Your required annual payment is divided by four. It's ideal for businesses with consistent, predictable income throughout the year.

For Fluctuating Income: The Annualized Method

Perfect for seasonal businesses or those with uneven income. This method lets you calculate your tax payment based on the income you've actually earned each quarter, which can significantly improve cash flow by lowering payments in lean periods. Complete the worksheet below.

Period Taxable Income for Period Annualized Income Required Installment

First 3 months $0 $0.00

First 3 or 5 months $0 $0.00

First 6 or 8 months $0 $0.00

First 9 or 11 months $0 $0.00

Visual Comparison of Payment Schedules

See how your quarterly payments differ between the two methods. The annualized method can help you keep more cash on hand during slower months.

Overpaid Your Estimated Taxes?

If you paid more tax than you expected, you can use Form 4466 to apply for a quick refund. Find out more information at the link below.

Learn How to Apply for a Quick Refund

This tool is for planning purposes based on the Instructions for Form 1120-W. It is not tax advice. Consult with a qualified tax professional for your specific situation.