(1) Taxpayers who file separate returns on separate forms for the current period and who filed a joint return for the preceding tax year must compute their prior year's estimated tax liability as follows:

(a) 100% of the tax liability of the joint return for the preceding tax year; or

(b)  a prorated portion of the preceding year's joint tax liability. This prorated amount is determined by calculating the tax liability of the taxpayers as if they filed separately and totaling their individual taxes. Each spouse's prior year estimated tax liability is found by dividing their separate liability by the total of the two separate liabilities and multiplying this figure by the preceding year's joint tax liability.

Example: Husband and wife file a joint return for the calendar year 2003 showing taxable income of $50,000 and a tax of $3,556. Of the taxable income, $30,000 was attributable to the husband and $20,000 to the wife. Husband and wife filed separate returns on separate forms for calendar year 2004. The tax shown on the return for the preceding taxable year, for purposes of determining if interest is owed on an underpayment, is determined as follows:

 

Taxable income of husband for 2003:                                                                        $30,000

Tax on $30,000 (on basis of separate return):                                                           $ 1,712

Taxable income of wife for 2003:                                                                               $20,000

Tax on $20,000 (on basis of separate return):                                                            $   934

Aggregate tax of husband & wife (on basis of

separate returns):                                                                                                          $ 2,646

Portion of 2003 tax shown on joint return

attributable to husband ($1,712/$2,646 X $3,556):                                                   $ 2,301

Portion of 2003 tax shown on joint return

attributable to wife ($934/$2,646 X $3,556):                                                              $ 1,255