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carriebarfels
February 3, 2025
Question

Why do I have a penalty?

  • February 3, 2025
  • 1 reply
  • 0 views
What is an underpayment penalty. I am employed full time

    1 reply

    SharonD007
    SharonD007
    February 3, 2025

    Our tax system is a pay as you go system, which means that as you earn money, you pay taxes on it.  You may have an underpayment penalty if you didn't have enough taxes withheld from your income throughout the year.  It doesn't matter if you're employed full time.

     

    Review the IRS topic 306, Penalty for underpayment of estimated tax for additional information. Also, review the TurboTax Help article Why am I getting an underpayment penalty?

     

    For more information, refer to the TurboTax help article Guide to IRS Tax Penalties: How to Avoid or Reduce Them.

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