Does paying 100% of the prior year's taxes in estimated taxes for the current year avoid the underpayment penalty?

Forum|Forum|1 year ago
March 4, 2025
2 replies
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The program says I have a penalty ($66) for underpayment of estimated taxes. My 2023 Federal total tax was $5411 and my 2024 total estimated tax payments were $5411, which I entered in the TurboTax credits section.

Best answer by ThomasM125

In general yes, but there are some qualifications. The tax payments would have to be 110% of the prior year's tax if you earned over $150,000 ($75,000 if filing married-separate). Also, the payments would have to be paid in on a quarterly basis and timely made.

ThomasM125Answer

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skwileyAuthor

Thanks for your quick response. My income is well below $150,000, and I am filing single as a widower. Am I missing something? If not, how do I get this corrected without upgrading to Live Help? Thanks in advance!

KeshaH

Confirm the dates that you entered for your estimated payments, and the amounts paid for each quarter. You can still get a penalty for not making the required payments by the due dates or not making enough of a payment for each quarter - even if you make the full payment by Q4.

Estimated payments for 2024 were due on:

- April 15, 2024 for Q1

- June 17, 2024 for Q2

- September 16, 2024 for Q3

- January 15, 2024 or Q4

sswwtang

I have the same problem.

There is no place to enter total tax of 2023 in TurboTax 2024. I called TurboTax customer service, the answer is "there is no need to enter 2023's total tax".

My question becomes:

Without knowing prior year's total tax, what is the way for TurboTax2024 to determine whether customer should pay penalty or not?

KeshaH

As you go through the underpayment screens, you should come to a screen that asks for your 2023 liability. It usually comes up early in the process right after confirming your 2023 filing status.

@sswwtang