D-422: Underpayment of Estimated Tax by Individuals (2024)
North Carolina · North Carolina DOR · Used for tax years 2024
North Carolina Form D-422 determines whether you owe interest for underpaying your 2024 estimated income tax and calculates the amount owed. It includes short and regular calculation methods. Keep this form for your records rather than filing it with your return.
Who files this form
Use Form D-422 to check whether you owe interest for underpaying your 2024 North Carolina estimated income tax and to calculate that interest. Do not file this form with your return. Keep it for your records.
In general, you may owe interest if your North Carolina withholding and timely estimated tax payments total less than the smaller of:
- 90% of your 2024 tax, or
- 100% of your 2023 tax, if your 2023 return covered a full 12 months.
You do not owe underpayment interest if:
- Your 2024 tax, minus tax credits and North Carolina withholding, is less than $1,000. Complete Part I, Lines 1 through 6 to check.
- You had no individual income tax liability for 2023, meaning tax shown due minus tax credits.
- You qualify for the farmer or commercial fisherman exception described below under deadlines.
When it's due
For tax year 2024, the form lists these estimated tax payment due dates:
- April 15, 2024
- June 15, 2024
- September 15, 2024
- January 15, 2025
If a payment due date falls on a Saturday, Sunday, or holiday, payment is due on or before the next business day.
Other dates that apply to the 2024 calculation:
- January 31, 2025: If you file your 2024 return and pay the tax due by this date, include the tax paid with your return in Part III, Line 17, column (d).
- March 1, 2025: Qualifying farmers and commercial fishermen can avoid underpayment interest by filing their 2024 Form D-400 and paying the entire tax shown due by this date. Farming, including oyster farming, or fishing must account for at least two-thirds of gross income from all sources for 2023 or 2024. Enter E in the exception box next to Form D-400, Line 26e.
- April 15, 2025: This is the ending date used for the form's interest calculation if the underpayment was not paid earlier.
What you'll need
Have these returns and payment details available:
- 2024 Form D-400: Line 15 for income tax, Line 16 for tax credits, and Lines 20a plus 20b for North Carolina withholding.
- 2023 Form D-400, if applicable: Lines 15 and 16 for prior-year tax after credits, plus any overpayment you elected to apply to 2024 estimated tax.
- 2024 estimated tax payment amounts and dates, including any tax paid with your return.
- Withholding payment details, if you want to show that withholding was paid differently from one-fourth on each payment due date.
- Form D-422A, 2024 Annualized Income Installment Worksheet, if you use the annualized income installment method.
The form also asks for the name or names shown on your tax return and your Social Security number.
How to file
Do not submit Form D-422 with your tax return. Keep it for your records. The text provides no mailing address or e-file directions for this form.
To complete it:
- Complete Part I, Lines 1 through 8, following the stop instructions where they apply.
- Use Part II, the short method, only if you meet its requirements. Otherwise, use Part III, the regular method.
- Enter the interest from Part II, Line 15, or Part III, Line 29, on Form D-400, Line 26e.
Common mistakes
- Attaching D-422 to your return. The form says to keep it for your records instead.
- Using the short method without checking eligibility. It cannot be used in all circumstances.
- Using a prior-year tax amount when Line 7 does not apply. If you were required to file a 2023 return but did not, or your 2023 tax year was shorter than 12 months, leave Line 7 blank and enter Line 4 on Line 8.
- Annualizing income for only some periods. If you annualize for any payment period, you must annualize for all periods.
- Missing the farmer or fisherman exception entry. If that exception applies, enter E next to Form D-400, Line 26e, to avoid an underpayment assessment.
- Completing the regular-method columns out of order. Complete Lines 18 through 24 of one column before moving to the next. Also complete Lines 25 and 26 of one column before moving to the next.
Questions people ask
When can I use the short method?
You can use it if you made no estimated tax payments for 2024, if your only such payments were North Carolina withholding, or if you paid the same estimated tax amount on each of the four payment due dates.
What if my income varied during the year?
The annualized income installment method may help you determine your required installments. Use Form D-422A and check the box on D-422, Line 16. If you annualize for one period, you must do so for all periods.
How is North Carolina withholding allocated?
You are considered to have paid one-fourth of your withholding on each payment due date unless you can show otherwise.
Where do I count a 2023 refund applied to 2024 estimated tax?
Include the 2023 overpayment you elected to apply to 2024 estimated tax in Part III, Line 17, column (a).
What if my withholding covers the required annual payment?
If Part I, Line 5 is equal to or greater than Line 8, stop. You do not owe underpayment interest.