How to Complete Form M-2220: Massachusetts Estimated Tax Underpayment

Massachusetts Form M-2220, “Underpayment of Massachusetts Estimated Tax by Corporations,” is the worksheet a corporation uses to calculate the addition to tax when its quarterly estimated excise payments fell short of what state law required. The completed form attaches to your annual corporate excise return, and the penalty figure transfers to a specific line on that return.¹ A quick note on names: the form is sometimes informally called “M-60,” but the Massachusetts Department of Revenue’s official designation is M-2220. If you were searching for a Minnesota M60 income tax voucher, that is a different form from a different state; this page covers the Massachusetts corporate underpayment calculation.

When You Actually Need to File M-2220

You only file the form if your estimated payments during the year came in below every available safe harbor. Estimated payments are required in the first place when a corporation reasonably expects its excise for the year to exceed $1,000.² At or below that threshold, no estimates are due and M-2220 does not apply.

If you did make estimated payments, three safe harbors can keep you out of penalty territory:

Payments totaling 100 percent of the prior year’s tax, provided the prior year covered a full 12 months and the return actually showed a tax liability.³
Payments totaling at least 90 percent of the tax due for the current year.
Payments totaling at least 90 percent of the tax calculated using current-year income but the prior year’s apportionment percentage.

One caution for larger filers. The prior-year safe harbor is not available to “large corporations” (those with $1 million or more of U.S. taxable income in any of the three preceding years, following IRC § 6655(g)). A large corporation may still use prior-year tax to size its first installment, but any reduction obtained that way must be added to the second installment.¹

The Uneven Installment Schedule

Before filling in the form, you need to know what the four installment columns represent. Massachusetts does not split the required annual payment into four equal quarters. The schedule is front-loaded:³

First installment, 40 percent, due by the 15th day of the 3rd month of the taxable year.
Second installment, 25 percent, due by the 15th day of the 6th month.
Third installment, 25 percent, due by the 15th day of the 9th month.
Fourth installment, 10 percent, due by the 15th day of the 12th month.

For a calendar-year corporation, those dates fall on March 15, June 15, September 15, and December 15. If a corporation starts paying estimates late, the catch-up rules under Section 4A compress the remaining schedule so that the earlier missed percentages shift into the first payment actually made.⁴

Filling Out the Form

Have your current-year corporate excise return (Form 355, 355S, or whichever applies) and your prior year’s return in front of you before starting.

Required Annual Payment

The top of the form establishes the benchmark your actual installments will be measured against. Line 3 asks you to multiply the current year’s income and non-income measures of excise by the prior year’s apportionment factor, apply the current tax rate, and multiply by 0.90.⁵ The form then compares that figure against the other safe harbor amounts to identify the controlling threshold.

The Form 355 instructions suggest a practical floor for the first payment: estimate your tax at no less than the prior year’s liability. If the prior year showed only the minimum excise, pay at least that minimum with the first installment.¹

The Four Installment Columns

Lines 7 through 12 are the core calculation. For each of the four columns, enter the required payment for that installment and subtract what you actually paid by the due date. The difference is that period’s underpayment.

If a later installment shows an overpayment, apply it first to any existing underpayment from an earlier installment. That does not erase the earlier shortfall retroactively, but it ends the period that will accrue interest. Anything left over credits forward against the next installment.⁵

If more than one payment was made toward a single installment, attach a separate computation showing the date and amount of each. The dates control the interest calculation, because the penalty runs only from the installment due date to the date you actually paid (or to the 15th day of the third month after the tax year ends, whichever is earlier).³

Transferring the Penalty to Your Return

The total from Line 35 of M-2220 moves to a line on your corporate return. The destination depends on which return you file:⁵

Form 355: Line 25a
Form 355U: Line 41
Form 355S: Line 28a
Form 355SC: Line 21a
Form 355SBC: Line 14
Form 63 FI: Line 25a
Form 63-20P: Line 34a
Form 63-23P: Line 41a
Form 63-29A: Line 39a
Form M-990T: Line 36a

How the Interest on the Shortfall Is Calculated

The addition to tax is not a flat penalty. It is simple interest on each underpayment for the days it remained outstanding. Massachusetts sets the rate at the federal short-term rate under IRC § 6621(b) plus four percentage points.⁶ Because the federal short-term rate changes quarterly, the effective rate shifts through the year, so check the Department of Revenue’s current posted rate before completing the form.

The accrual period for each installment runs from its due date to the earlier of the date you paid the shortfall or the 15th day of the third month after the tax year closes.³ This is why exact payment dates matter on the form: a later overpayment applied back to an earlier shortfall shortens that period.

Filing the Form

Massachusetts requires corporations to file returns and pay taxes electronically.⁷ Form M-2220 is submitted as part of the corporate excise return through MassTaxConnect, the Department’s online portal.⁸ You log into the business account, enter the M-2220 data within the return workflow, and submit everything together. Keep the confirmation number the system issues.

Requesting Abatement of the Penalty

If the underpayment resulted from reasonable cause rather than neglect, you can ask the Department to waive the addition to tax. The request goes through MassTaxConnect for corporations required to file electronically, or on paper using Form ABT, Application for Abatement. Electronic requests move faster.⁹

To qualify, the corporation must have exercised the degree of care an ordinary taxpayer in the same position would have shown. Circumstances Massachusetts recognizes as supporting a reasonable-cause claim include:

Death or incapacitating illness of the person responsible for the corporation’s tax compliance.
Unavoidable absence of the responsible party during the filing period.
Destruction of records by fire, natural disaster, or other casualty.
Inability to obtain necessary information despite reasonable efforts.
Erroneous written advice from DOR personnel after you provided all relevant facts.
Incorrect guidance from a competent tax advisor given complete information.
Ambiguity in the statute or conflicting interpretations of the law.
A documented electronic payment system failure that prevented timely submission.

Not knowing about the estimated payment requirement, making a math error, or lacking funds generally does not qualify on its own. Include documentation with the request: medical records, correspondence with your advisor, system error logs, or similar evidence tied to the specific circumstance you are claiming.

1
Mass.gov. 2025 Instructions for Massachusetts Corporation Excise Return Form 355
2
Massachusetts Department of Revenue. 830 CMR 63B.2.2 – Payments of Estimated Corporate Excise
3
General Court of Massachusetts. Massachusetts Code Chapter 63B – Section 3
4
General Court of Massachusetts. Massachusetts Code Chapter 63B – Section 4A
5
Mass.gov. Form M-2220 Underpayment of Massachusetts Estimated Tax by Corporations
6
Mass.gov. Interest on Your Massachusetts Tax Underpayment or Overpayment
7
Mass.gov. Massachusetts DOR Corporate Excise Tax Guide
8
Mass.gov. Filing Returns in MassTaxConnect
9
Mass.gov. AP 633 Guidelines for the Waiver and Abatement of Penalties