Question

Which of these is an incorrect statement regarding estimated tax payments?

A) If the taxpayer's AGI for 2019 was more than $150,000 (or more than $75,000 if their 2020 filing status is MFS), they must prepay 110% of their 2019 tax.

B) If at least two-thirds of the taxpayer's 2019 or 2020 gross income comes from farming or fishing, they are required to prepay only two-thirds of their 2019 tax.

C) An employee required to pay estimated tax may direct their employer to withhold extra income tax from their wages by providing the employer with a new Form W-4 instead of making estimated tax payments.

D) Form 1040-ES must be filed for 2020 if estimated tax is $500 or more.

Answer 1

Answer is :

Option B (If at least two-thirds of the taxpayer's 2019 or 2020 gross income comes from farming or fishing, they are required to prepay only two-thirds of their 2019 tax)

For Reference:

As noted in the IRS release—IR-2020-37 (February 20, 2020)—this special rule applies to taxpayers whose farming or fishing income was at least two-thirds of the total gross income in either the current or the preceding tax year. Farmers and fishermen can avoid the estimated tax penalty by both filing and paying all taxes due by March 2, 2020.

Taxpayers who made an estimated tax payment on or before January 15, 2020, can wait and file by the regular April 15 deadline