IL-2220

This article explains what Illinois Form IL-2220 is and gives clear, line-by-line instructions to complete and attach it to your business return.

Form IL-2220 is the Illinois Department of Revenue worksheet corporations, partnerships, pass-through entities, trusts/estates, and exempt organizations use to compute business penalty amounts for a tax year—specifically (1) the late-payment penalty for underpaying estimated tax, (2) the late-payment penalty for unpaid tax, and (3) in certain cases, a late-filing penalty. It applies to tax years ending on or after December 31, 2024 and must be attached to your IL-1120, IL-1120-ST, IL-1065, IL-1041, or IL-990-T when you choose to figure penalties yourself. Illinois encourages filers to let the Department calculate and bill penalties; however, you must complete IL-2220 if you use the annualized income installment method (Step 6) to compute required installments. You do not owe the underpayment penalty if your timely estimated installments equaled at least 90% of this year’s tax or 100% of last year’s tax (if last year showed a liability and wasn’t a short year). Penalties are based on the tax shown on your original return; do not base required installments on an amended return filed after the extended due date.

How To File IL-2220

  1. Confirm You Need The Form. Use IL-2220 if you are computing penalties yourself, and you must use it if you’re annualizing income in Step 6. Otherwise, you may let Illinois compute penalties and bill you.
  2. Attach To The Correct Return. Include IL-2220 with IL-1120, IL-1120-ST, IL-1065, IL-1041, or IL-990-T for years ending on/after 12/31/2024.
  3. Use Original-Return Figures. When Step 2 asks for required installments, base them on the original return (not a later-filed amended return past the extension date).
  4. Keep Proof. Retain schedules that support every line, payment date, and computation you enter.
How To Complete IL-2220

How To Complete IL-2220

Read This First (Top Of Page 1)

  • Attachment & Year Scope. Attach IL-2220 to the business return listed above; it covers tax years ending on or after 12/31/2024.
  • Safe Harbors. No estimated-tax underpayment penalty if you paid ≥90% current year or 100% prior year by timely installments (prior year must show tax and not be a short year).
  • Original-Return Basis. Required installments are computed from the original tax.

Step 1 — Provide The Following Information (Lines 1–4)

  1. Calendar Or Fiscal Year. Check it’s for 2024 calendar-year or enter your fiscal year begin and end dates.
  2. FEIN. Enter the FEIN exactly as on your annual return.
  3. Name. Enter your business name as on the annual return.
  4. Prior-Year FEIN (If Different). If last year’s return used a different FEIN, enter that number.

Step 2 — Figure Your Required Installments (Lines 5–16)

Step 2 is for IL-1120 filers and IL-1120-ST/IL-1065 filers that elected PTE tax. Complete the quarter grid for Q1–Q4.

  1. Tax Basis — This Year / Prior Year. In Column A, enter this year’s tax per instructions. In Column B, enter last year’s tax; if zero or last year was a short year, enter “N/A.” Note: you may still owe installments even if Column B is “N/A.”
  2. Withholding & PTE Credits. Enter the total pass-through withholding, PTE tax credit, Illinois gambling withholding, and Illinois sports-wagering withholding from your IL-1120/IL-1120-ST/IL-1065.
  3. Net Current-Year Tax For Installments. Line 5, Col. A − Line 6.
  4. 90% Calculation. Line 5, Col. A × 90% (0.9).
  5. Required-Tax Base With Thresholds.
    • IL-1120: If Line 7 ≤ $400, enter 0 and go to Step 3.
    • IL-1120-ST/IL-1065 (elected PTE): If Line 7 ≤ $500, enter 0 and go to Step 3.
    • Otherwise, enter the lesser of Line 8 or Line 5, Col. B. If you entered “N/A” in Line 5, Col. B and you exceed the $400/$500 threshold, enter Line 8.
  6. Each Required Installment. Line 9 ÷ 4. (If you will annualize, see Line 12.)
  7. Due Dates. Enter the dates that fall on the 15th day of the 4th, 6th, 9th, and 12th months of your tax year (by quarter).
  8. Required Installment For Each Quarter. Enter the amount due for each quarter (use Step 6 if you annualize).
  9. Credits Received Each Quarter. Enter pass-through withholding, gambling & sports-wagering withholding, and PTE credit received for that quarter.
  10. Net Installment After Credits. Line 12 − Line 13 (if negative, use brackets).
  11. Carryover Of Prior-Quarter Underpayment. If Line 16 of the previous quarter is negative, enter that amount as a positive here; otherwise enter 0. Skip this line for Quarter 1.
  12. Unpaid Amount For Each Quarter. Line 14 − Line 15 (if negative, use brackets).

Step 3 — Figure Your Unpaid Tax (Lines 17–19)

  1. Total Taxes & Withholding Owed. Enter your net income and replacement tax, surcharges, pass-through withholding reported on behalf of members, and any PTE tax you owed (per instructions).
    18a. All Payments Made On/Before Original Due Date. Include credits carried forward, all estimated/pre/extension/annual payments, pass-through withholding reported for you, PTE credit, and withholding on W-2G/1099.
    18b. Installments From Step 2. IL-1120/-ST/-1065: enter the total of all Columns, Line 12. All others: enter 0.
    Line 18: Enter the greater of 18a or 18b.
  2. Unpaid Tax To Carry Forward. Line 17 − Line 18.
  • If positive, carry this to Penalty Worksheet 2, Line 23, Column C and continue.
  • If zero or negative, enter it (use brackets if negative).

Step 4 — Figure Your Late-Payment Penalties (Payments & Rates)

  1. List Each Payment. For every payment (and any credit carried forward), enter the amount and date paid in the grid (a–l). You’ll use these dates in the penalty worksheets. Penalty rates based on days late: 1–30 days = 2%, 31+ days = 10%.

Penalty Worksheet 1 — Underpayment Of Estimated Tax (Lines 21–22)
21. Quarter By Quarter. For each quarter, take the unpaid amount from Line 16 and complete Columns A–I: due date, unpaid amount, payment applied, balance due, payment date, number of days late, penalty rate, and the penalty.
22. Total Penalty For Underpaid Estimates. Add Column I for all quarters; enter the total here and on IL-1120 Step 8 Line 59, IL-1120-ST Step 9 Line 63, or IL-1065 Step 9 Line 63. Note: You may apply any remaining overpayment from Q4 (Column E) to Worksheet 2 only if the Q4 payment date (Column F) is after the original due date of the return.

Penalty Worksheet 2 — Unpaid Tax (Lines 23–24)
23. Enter any positive amount from Line 19 into Column C, then complete Columns A–I (due date, unpaid amount, payment applied, balance due, payment date, days late, rate, penalty).
24. Total Penalty For Unpaid Tax. Add Column I and carry the result to Step 5, Line 28.

Step 5 — Figure Your Late-Filing Penalty, Total Penalties, And Amount You Owe (Lines 25–30)

Complete Lines 25–27 only if you are filing after the extended due date and the tax wasn’t paid by the original due date.

  1. Tax Due From Your Return. Enter the amount per the instructions for your return type.
  2. 2% Calculation. Line 25 × 2% (0.02).
  3. Late-Filing Penalty. Enter the lesser of Line 26 or $250.
  4. Late-Payment Penalty For Unpaid Tax. From Worksheet 2, Line 24.
  5. Return Overpayment/Amount Due. If your return shows an overpayment, enter it as a negative; if it shows an amount due, enter that here.
  6. Total You Owe (or Overpaid). Lines 27 + 28 + 29. Positive = amount you owe; negative = overpaid. You can pay Line 30 now to resolve penalties, or wait for a bill.

Step 6 — Annualization Worksheet For Step 2, Line 12 (Lines 31–51)

Complete all Lines 31–51 in Columns A–D if you choose to annualize because income wasn’t even during the year. If you do not fully complete Step 6, Illinois may disregard the annualization election and compute your underpayment penalty as four equal installments.

Top Grid (A = first 3 months; B = first 6; C = first 9; D = first 9 months)
31. Illinois Net Income For Each Period (zero if negative).
32. Annualization Factors. (Use the printed factors).
33. Annualized Income. Line 31 × Line 32.

Lower Grid (A = first 3 months; B = first 5; C = first 8; D = first 11)
34. Illinois Net Income For Each Period (zero if negative).
35. Annualization Factors.
36. Product. Line 34 × Line 35.
37. Pick The Amount. Column A: use Line 36, Col. A. Columns B–D: enter the lesser of Line 33 or 36 for that column.
38. Net Replacement Tax For The Period. (Per instructions.)
39. Net Income Tax or PTE Tax For The Period. (Per instructions.)
40. Cannabis Surcharge For The Period.
41. Gaming Licensee Sale-Of-Assets Surcharge For The Period.
42. Total For Period. Lines 38 + 39 + 40 + 41.
43. Applicable Percentage. Use: 22.5%, 45%, 67.5%, 90% (by column).
44. Annualized Installment. Line 42 × Line 43.
45. Total Of Earlier Required Installments. Add Line 51 from each prior column; Column A has none (leave as indicated).
46. Current Column Balance. Line 44 − Line 45 (zero if negative).
47. Per Instructions. Complete as directed in the official instructions.
48. Prior-Column Line 50. Enter Line 50 from the preceding column (none for Column A).
49. Add Lines 47 + 48.
50. Excess Prior Payments. If Line 49 > Line 46, Line 49 − Line 46; otherwise 0. (Not applicable where the form indicates not to write.)
51. Required Installment. Lesser of Line 46 or Line 49. Carry this to Step 2, Line 12 for the corresponding quarter.

PTE Tax Worksheet — For Step 6, Line 39 (Lines 52–59)

(IL-1120-ST and IL-1065 filers who elected PTE tax only)

Upper Grid (A = first 3 months; B = first 6; C = first 9)
52. Illinois Net PTE Income For Each Period (the amount that would appear on IL-1120-ST/IL-1065 Step 9, Line 60; zero if negative).
53. Annualization Factors.
54. Annualized PTE Income. Line 52 × Line 53.

Lower Grid (A = first 3 months; B = first 5; C = first 8; D = first 11)
55. Illinois Net PTE Income For Each Period (same reference as above; zero if negative).
56. Annualization Factors.
57. Product. Line 55 × Line 56.
58. Pick The Amount. Column A: use Line 57, Col. A. Columns B–D: enter the lesser of Line 54 or 57.
59. Compute PTE Tax For Step 6, Line 39. Line 58 × 4.95% (0.0495); carry each column’s result to Step 6, Line 39.

Footer & Authority

  • The form is an Illinois Income Tax Act attachment (IL Attachment No. 19). Disclosure is required; failure to provide information can result in penalty. The final page notes “Printed by the authority of the state of Illinois – electronic only – one copy.”
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