A. For purposes of this rule, the following
definitions apply:
1. "Annual estimated tax
payment" means 1/2 of the total tax liability for the entire month of May
or the total tax liability for the first 15 days of the month of
June.
2. "Annual tax liability"
means a total tax liability of in the preceding calendar or a reasonable
anticipation of a total tax liability in the current year as follows:
$1,000,000 in 2019
$1,600,000 in 2020
$2,300,000 in 2021
$3,100,000 in 2022
$4,100,000 in 2023 and thereafter.
3. "Taxpayer" has the meaning set forth in
A.R.S. §
42-5014(S).
The following are considered a single taxpayer:
a. Members of an Arizona-affiliated group
filing a consolidated corporate income tax return under A.R.S. §
43-947;
b. Corporations in a unitary business filing
a combined corporate income tax return under R15-2D-401;
c. Married taxpayers operating separate sole
proprietorships and filing a joint income tax return; or
d. Partnerships, Limited Liability Companies,
S Corporations, trusts, or estates conducting multiple businesses, filing a
single income tax return.
4. "Total tax liability" means the combined
total of the transaction privilege tax, telecommunications services excise tax,
and county excise tax liabilities.
B. The requirement to make an annual
estimated tax payment is based on the annual tax liability. Use tax and
severance tax are not subject to the estimated tax provisions.
1. A taxpayer shall make an annual estimated
tax payment if during the current calendar year the taxpayer, through use of
ordinary business care and prudence, can anticipate incurring the annual tax
liability. For example:
ABC Company has been selling home electronics for several
years. Its tax liability for previous calendar years has averaged between
$600,000 and $700,000. In February of the current year, ABC Company begins
selling computers and accessories as well. Early sales reports show an increase
in total sales of approximately 50%. Based on these facts, ABC Company can
reasonably anticipate incurring the annual tax liability.
2. Taxpayers with multiple locations shall
make the annual estimated tax payment based on the combined actual or
anticipated annual tax liability from all locations. Taxpayers with multiple
locations, shall make a single estimated payment each June.
C. A taxpayer shall not amend an
annual estimated tax payment except to increase the amount of the
payment.
D. The annual estimated
tax payment shall not be applied, credited, or refunded until a Transaction
Privilege, Use, and Severance Tax Return for the month of June is
filed.
E. Late payment,
underpayment, or non-payment of the annual estimated tax payment shall result
in the following:
1. Application of the
penalty provisions under A.R.S. §
42-1125;
2. Accrual of interest beginning from the due
date of the annual estimated tax payment as prescribed in A.R.S. §
42-5014(D);
and
3. Loss of the accounting
credit, as defined in A.R.S. §
42-5017
for the June reporting period.
F. Taxpayers who are not required to make the
annual estimated tax payment but make a voluntary annual estimated payment are
not subject to subsection (E).
