.02 Estimated Tax Return.

A. Resident and Nonresident Individuals Other Than Farmers.

(1) Every individual receiving taxable income which is not subject to the withholding provisions of the Maryland Income Tax Law and Regulation .01 of this chapter and which is not specifically exempt under the Law shall file on Form 502-D or 502-DEP a declaration of estimated tax if the individual's gross income not subject to Maryland employer withholding would be expected to develop a tax of more than $500. Declarations with payments in full are to be filed within 60 days of the receipt of $500 or more of income from awards, prizes, lotteries, or raffles, whether paid in cash or property. The declaration of estimated tax shall be filed on or before April 15, June 15, September 15, and January 15.

(2) Payment of 1/4 of the tax estimated to be due and owing shall be made at the time fixed in these regulations for the filing of the estimated tax return on Form 502-D or 502-DEP. An amended declaration of estimated tax may be filed on any of the dates specified in these regulations subsequent to the filing of the estimated return required to be filed on or before April 15 of the current calendar year. Instead of the final estimated return due to be filed for a given calendar year on or before January 15 following the close of the calendar year, the individual, if the individual so elects, may file, on or before January 31, the individual's final return at which time any tax remaining unpaid shall be paid in full. The filing of the final return and the payment in full of the tax shown on it, less any payment of tax previously made, shall be considered as the filing of the estimated return due on or before January 15 or as an amendment to a previously filed declaration of estimated tax covering the same taxable year.

(3) Overpayment of the previous year income taxes may be applied to current year estimated income tax. The overpayment may be partially or fully applied to the first installment. If the overpayment equals or exceeds the estimated tax liability for the first installment, the declaration is not required. If the overpayment does not equal the estimated tax liability, a declaration should be filed and the balance paid.

(4) Unpaid Tax.

(a) Except as otherwise provided in this regulation, the Comptroller shall assess interest and penalty on the underpayment of estimated tax based on the unpaid tax from the due date of the tax to the date on which it is paid.

(b) The unpaid tax is the lesser of:

(i) 90 percent of the tax required to be shown on the return for the current taxable year; or

(ii) 110 percent of the tax paid for the prior taxable year, reduced by any credit allowed under Tax-General Article, §§10-703 and 10-703.2, Annotated Code of Maryland.

(c) The Comptroller may not assess interest or penalty if:

(i) The underpayment is less than $500; or

(ii) At least 90 percent of the individual's taxable income is taxable by another state, and the underpayment is of the county income tax only.

B. Farmers and Fishermen. An individual whose estimated gross income from farming (including oyster farming) and fishing is at least 2/3 of the total estimated gross income from all sources for the taxable year, instead of the dates set forth in §A of this regulation, may file a declaration of estimated tax on Form 502-D or 502-DEP at any time on or before January 15 of the succeeding taxable year, but if this individual files a return for the taxable year for which the declaration is required and pays in full the tax computed on the return as payable on or before March 1 of the succeeding taxable year, then the return shall be considered as the declaration, or if the tax shown on the return is greater than the estimated tax shown on a declaration previously made, or in the last amendment of the declaration, the return shall be considered as an amendment of the declaration to be filed on or before January 15 of the succeeding taxable year.