Question

Cyrilia is single. Her California adjusted gross income is less than $150,000. Her tax liability was:
$4,000 in 2025, 90% is $3,600.
$2,000 in 2024.
What is the least amount Cyrilia must pay in estimated payments to avoid a penalty?
$500
$2,000
$3,600
$4,000

Answer 1

$2,000

Reason: For California taxpayers with CA AGI under $150,000 the safe-harbor is the lesser of 90% of the current-year tax ($3,600) or 100% of the prior-year tax ($2,000). The smaller amount ($2,000) is sufficient to avoid an underpayment penalty.