TurboTax penalty calculation

Forum|Forum|1 year ago
February 16, 2025
1 reply
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Turbotax deluxe estimated a tax penalty on my return of $347, but I don't see where it ever asked for dates of income. How does it calculate this penalty? Most of my income came from long term capital gains in November and an IRA rollover to a ROTH IRA in December. My other income came from monthly interest and dividends in which no tax was taken, and from monthly pension and job income which had taxes taken out. I carried over a 2023 refund to 2024 taxes and paid estimated taxes that I believe covered taxes owed. I believe that TT calculated all my income equally over the whole year, instead of just in the 4th quarter when the cap gains and rollever were realized. I can find no forms in TT that show how it was calculated. How do I find out how it was calculated? I manually filled in form 2210 and it appears to show no penalty .

Best answer by VolvoGirl

If you get a penalty on 1040 line 38, you might be able to eliminate it or at least reduce it. You can go to Federal Taxes tab or Personal tab, under Other Tax Situations and select Start by the Underpayment Penalties. You will answer a series of questions that may reduce or eliminate the penalty. Or you can elect to have the IRS figure the penalty for you. It's form 2210.

How to add form 2210 for Underpayment Penalty
https://ttlc.intuit.com/community/tax-payments/help/how-do-i-add-form-2210/00/25703

It's under

Federal or Personal (for Home & Business Desktop)

Other Tax Situations

Additional Tax Payments

Underpayment Penalties - Click the Start or update button

VolvoGirlAnswer

Employee

How to add form 2210 for Underpayment Penalty
https://ttlc.intuit.com/community/tax-payments/help/how-do-i-add-form-2210/00/25703

It's under

Federal or Personal (for Home & Business Desktop)

Other Tax Situations

Additional Tax Payments

Underpayment Penalties - Click the Start or update button

moosebob49Author

Thank You so much! This is exactly the info I needed. I found the forms exactly where you indicated they would be. I just went through this on TT and it eliminated all penalties. Since I paid my quarterly tax at the same time as my conversion and my capital gains, this is what I expected.

I also looked up the similar area on my state return and eliminated the penalty there also.

I just saved ~ $430.

I appreciate the help and the fast response!