M-2220: Underpayment of Massachusetts Estimated Tax by Corporations (2024)
Massachusetts · Massachusetts DOR · Used for tax years 2024
Massachusetts Form M-2220 calculates a corporation’s underpayment of estimated tax for 2024 and any resulting underpayment penalty. It compares installment amounts with payments and credits, then calculates the penalty based on the amount and duration of each underpayment.
Who files this form
Corporations taxed under Chapter 63 of the Massachusetts General Laws should use Form M-2220 to check whether they paid the correct amount of estimated tax on time. An underpayment may result in a penalty.
Corporations are liable for estimated payments even if they did not file a 2023 return or their 2023 return covered less than 12 months. Include Form M-2220 with the corporation’s return.
When it's due
- 2024 estimated tax installments: The form lists the 15th day of the 3rd, 6th, 9th and 12th months of the corporation’s taxable year.
- Return filing dates listed in the 2024 instructions: C corporation returns are due on the 15th day of the fourth month after the taxable year closes. S corporation returns are due on the 15th day of the third month after the taxable year closes.
- Printed April 2024 holiday rule: The 2024 instructions state that returns, payments with returns and estimated payments otherwise due April 15, 2024, are treated as timely if filed or paid by April 16, 2024.
The instructions remind corporations to pay the first estimated installment by its installment due date, not the return due date.
What you'll need
Have the following information ready to complete the form:
- Corporation name and Federal Identification number.
- 2024 tax and 2023 tax amounts.
- The 2023 income apportionment percentage and the 2024 excise amounts and tax rate used for line 3.
- Amounts paid or credited for each installment, payment dates and any overpayments carried forward.
- The corporation’s taxable-year dates, to identify installment due dates.
If more than one payment was made for an installment, attach a separate computation for each payment.
How to file
File electronically and include Form M-2220 with the corporation’s return. The form states that paper returns will not be accepted.
Complete the underpayment calculation for each applicable installment column, then calculate the penalty. Transfer the total from line 35 to the corresponding penalty line on the corporation’s tax return, as listed in the form’s instructions.
For questions about electronic filing, call 617-887-6367. The form directs filers to the DOR electronic filing and payment requirements and TIRs 16-9 and 21-9.
Common mistakes
- Sending a paper return. The form warns that electronic filing is required and paper returns will not be accepted.
- Waiting until the return due date to pay the first estimated installment. The instructions specifically warn to pay by the first installment due date to avoid underpayment penalties.
- Assuming a prior-year overpayment is credited on the first installment due date. The instructions say it is considered paid as of the prior-year return due date.
- Missing the special rule for new corporations. The instructions note that new corporations in their first full taxable year with fewer than 10 employees have lower payment percentages and should check the box on line 7.
Questions people ask
What if the corporation did not file a 2023 return or filed a short-year return?
Estimated payments are still required. If there was no 2023 return, or it covered less than 12 months, enter the smaller of lines 2 and 3 on line 5.
Can a large corporation use its prior-year tax to calculate installments?
A corporation with $1 million or more of federal taxable income in any of its three preceding taxable years may use its prior-year tax liability only to calculate the first quarterly estimated payment. Any reduction in that first payment must be added to the second installment.
How is an installment overpayment applied?
It may first be used to pay an existing underpayment. This reduces the period subject to penalty rather than the original underpayment amount. If there is no existing underpayment, the overpayment is credited against the next installment.
When does the penalty calculation stop?
Line 14 uses the payment date or the 15th day of the third month after the taxable year closes, whichever is earlier.