IT-2105: Estimated Tax Payment Form

Who Must Make Estimated Tax Payments

You are required to make estimated tax payments to New York State if you expect to owe at least $300 in New York State, New York City, or Yonkers income tax for the year, and the tax will not be fully covered by withholding from your paycheck. This primarily applies to:

• Nonresidents with significant New York source income (e.g., freelance work in NY, rental income from NY property, partnership income from NY businesses).
• Part-Year Residents with substantial income during their resident period.
• Residents with significant income not subject to withholding (self-employment income, investment income, large capital gains).

Tip: If you also have a W-2 job, you can avoid estimated payments entirely by increasing your New York State withholding via Form IT-2104.

How to Calculate Your Estimated Tax

To avoid an underpayment penalty, your total payments (withholding + estimated payments) for the year must meet one of these safe harbors:

• Safe Harbor 1: 90% of your current year's total New York tax liability.
• Safe Harbor 2: 100% of your prior year's total New York tax liability (110% if your prior year's NY adjusted gross income exceeded $150,000 / $75,000 if married filing separately).

The “100% of Prior Year's Tax” rule is your safest approach. If your prior year's NY tax was $5,000, pay in at least $5,000 this year via withholding and estimates to avoid penalties — regardless of how much higher your current year's income may be.

Payment Schedule

Your total required annual payment must be paid in four equal installments:

How to Make Payments

Electronic Payment (Recommended): Pay directly from your bank account via the NYS Tax Department website (no fee), or by credit/debit card through authorized processors (convenience fee applies).

Payment by Mail: Use the payment vouchers (Form IT-2105-V) included in the IT-2105 packet. Mail check or money order with the correct voucher to the address listed. Note that mail delays can cause missed deadlines.

Penalties for Underpayment

If you do not meet one of the safe harbors, you will owe an underpayment of estimated tax penalty. This is calculated like interest for each period a payment was late or insufficient — the rate changes quarterly. The penalty is calculated automatically by the tax department when you file your annual return. You can calculate it yourself in advance using Form IT-2105.9.

Frequently Asked Questions

I am a nonresident with NY source income. Do I pay estimates to NY or just to the IRS?

You must pay estimates to both. Federal (Form 1040-ES) and New York State (IT-2105) estimated tax requirements are separate. You likely also have an obligation to your state of residence.

My income is very uneven — most comes in Q4. Will I be penalized?

Not if you use the Annualized Income Method. You can file Form IT-2105.9 with your annual return to calculate each quarter's payment based on your actual income earned year-to-date, rather than assuming equal income each quarter.

I missed the April and June deadlines. Should I just wait until next year?

No. Make a catch-up payment immediately. The penalty accrues for each late period. A large payment now will reduce your total penalty. Get back on schedule for September and January.

How does this interact with my resident state's estimated payments?

They are completely separate. Most states require their own estimated payments if you expect to owe over a certain threshold (often $500). You must track and comply with each state's rules independently.

What if I overpay my estimated tax?

You will receive a refund when you file your annual New York State tax return. There is no penalty for overpayment, but you are giving the state an interest-free loan.

I have significant capital gains in November. Do I need to make an estimated payment in January?

Yes. The January 15 payment covers income from September 1 – December 31. If you realize a large capital gain in November, you should make an estimated payment by January 15 to avoid an underpayment penalty for the fourth quarter.