Which of the Following Statements About Estimated Tax Payments and Underpayment

question 36

Multiple Choice

Which of the following statements about estimated tax payments and underpayment penalties is true for individual taxpayers?

• A) Taxpayers who have paid their full tax liability by the original tax return due date are protected from underpayment penalties.
• B) Taxpayers who have uneven income streams can pay estimated tax quarterly in uneven amounts and not be susceptible to underpayment penalties.
• C) Taxpayers who have paid their required amount of estimated tax, even though not on time, are protected from underpayment penalties.
• D) Taxpayers who have paid their full tax liability by the extended tax return due date are protected from underpayment penalties.

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Definitions:

Developmental Reasons

Underlying causes or motives related to growth, progress, or change in an individual or organization.

Performance Appraisals

The evaluation process through which employee performance is assessed, typically on an annual or semi-annual basis.

Reliable

The quality of being consistently good in performance, accuracy, or durability, often used to describe products, services, or sources of information.

Valid

Having a sound basis in logic or fact; accurately representing the truth or reality.