Question

I made a big IRA conversion to a ROTH on December 28th, Turbo Tax is applied a $735 penalty to my Indiana return for tax underpayment last year. Why a penalty?

Forum|Forum|4 years ago
March 25, 2022
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TurboTax Self Employed Online

Employee

If you owe more than $1,000, a penalty is generally added to your tax bill for underpayment throughout the year. The Indiana instructions in IT-40 Booklet state on page 9:

Generally, if you owe $1,000 or more in state and county tax for the year that’s not covered by withholding taxes, you need to be making estimated tax payments. You might owe this penalty if:

• The total of your credits, including timely made estimated tax payments, is less than 90% of this year’s tax due or 100% of last year’s tax due, ** or

• You underpaid the minimum amount due for one or more of the installment periods.

If either of these cases apply to you, you must complete Schedule IT-2210 or IT-2210A to see if you owe a penalty or if you meet an exception.

• If you owe this penalty, complete Schedule IT-2210 or IT-2210A and write the penalty amount on Form IT-40, line 20.

• If you meet an exception, complete Schedule IT-2210 or IT-2210A to show which exception was met

Since your income was primarily at the end of the year, you will want to use IT2210-A, as described on page 10 and annualize your income to reduce your penalty.

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G

gcreasey--

Please note that the 2022 Indiana Schedule IT-2210A in Turbo Tax has a software error. The value in Section III, Item 19 Column B does not transfer to Item 13 Column C like it is supposed to and all of the subsequent calculations are affected. I tried to contact Turbo Tax IT but unable to do so. It caused Indiana to send me a notification of the problem which caused them to reject Schedule IT-2210A which made me have to pay a penalty. No help from Turbo Tax whatsoever.

DMarkM1

I have been unable to duplicate your error in TurboTax Premier Desktop; it appears to work for me. Would you mind sending a sanitized version of your return so I that I might take a closer look?

If so, in your desktop version use the "Online" tab at the top of page and select "Send tax file to agent." After that repost here with the token number and @DMarkM1 please.

@gcreasey--

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