California Estimated Tax Question

[Tina777]

My aunt had a zero tax liability in California in 2024 because her social security benefits were less than $25,000.  She sold her house this year and will have a California AGI greater than $500,000 in 2025.  Does she need to make estimated payments in California this year even though her 2024 tax liability was zero?

[Vanessa A]

It is always better to pay in the quarter you receive the money instead of applying for a penalty waiver. 

However, CA does follow the IRS steps for penalty waiver.  If her last year tax liability was $0, then she would be able to apply for the penalty waiver if she does not pay until 2025.