I have a penalty for underpayment of estimated taxes. The penalty is $91. I've never paid estimated taxes... how can I get this penalty waived?

To calculate the underpayment penalty and attempt to get it reduced, follow these steps:

• Under the Federal menu, choose Other Tax Situations
• Expand the menu for Additional Tax Payments
• Click Start/Revisit next to Underpayment Penalties
• Choose the annualized installment method to recalculate

Avoiding Estimated Tax Penalties

You can also choose to have the IRS figure out your penalty.  Go through the above section for Underpayment Penalty and during that interview, one of the questions will ask if you would rather have the IRS calculate your penalty.  Say Yes, and this will override any penalty TurboTax has calculated.  If you are liable for a penalty, the IRS will send you a bill for this amount later.

To avoid a penalty, you need to make estimated tax payments if you expect to owe $1,000 or more in taxes for the year. The tricky part is estimating income and tax liability before the income is earned, especially for self-employed taxpayers.

If you pay 100% of last year's tax liability (line 16 of your 2019 1040), you can avoid penalties. Simply take the amount from your return, divide by four, and make four equal payments.

However, if your adjusted gross income (AGI) was greater than $150,000, that estimate must be 110% of last year's tax liability.

You can also pay 90% of this year's tax liability to avoid penalties. This is more difficult to estimate, as you need to determine what that amount will be.

Estimated Tax Payments

IRS Estimated Taxes

Estimated Taxes: How to Determine What to Pay and When