81-03-04-02 Payments of estimated taxes by individuals, estates, and trusts.

1. Except as otherwise provided, an individual, estate, or trust subject to section 6654 of the Internal Revenue Code, relating to failure to pay estimated income taxes, shall make payments of estimated state income tax. 2. For purposes of subsection 5 of North Dakota Century Code section 57-38-62: a. An amended return filed on or before the due date, including extensions for filing the original return, is the individual's, estate's, or trust's return for that taxable year. b. An audit assessment does not affect the calculation of estimated tax payments. 3. Interest for failure to make payments of estimated state income tax must be waived by the tax commissioner in the following situations: a. When an individual derives over two-thirds of gross income from farming, files a federal income tax return by March first of the following tax year, and pays the federal tax in full by that same date, but does not make payments of estimated state income tax. The individual does not have to file a state income tax return or pay any state income tax due on or before March first of the following tax year to qualify for this waiver of interest. b. When an individual derives over two-thirds of gross income from farming, makes the one required estimated federal tax installment on January fifteenth of the following tax year, files a federal income tax return after March first of the following tax year, and pays the estimated state income tax due on January fifteenth of the following tax year. The first three payments due on April fifteenth, June fifteenth, and September fifteenth of the current tax year are not required to qualify for this waiver of interest. 2 c. When an individual, estate, or trust utilizes the annualized income installment method for federal purposes as provided in section 6654 of the Internal Revenue Code, and makes the required estimated state income tax payment based thereon. d. When an individual, estate, or trust has a current year tax liability which exceeds the taxpayer's withholding by less than five hundred dollars, and the taxpayer does not make payments of estimated state income tax. The five hundred dollar limitation applies per return. 4. To determine tax liability for the immediately preceding year, married taxpayers who filed separate returns in the prior year, but who plan to file a joint return for the current year, shall combine the tax liabilities reflected on their prior year returns. Joint estimated tax payments for the current year must equal or exceed one hundred percent of the couple's total tax liability for the prior year if the prior year test is applicable. History: Effective November 1, 1987; amended effective July 1, 1989; March 1, 1990; November 1, 1991; April 1, 1996; June 1, 2002. General Authority: NDCC 57-38-56 Law Implemented: NDCC 57-38-45, 57-38-62, 57-38-63, 57-38-64