IRS Notice CP23

[AJ223]

I received an IRS notice CP23 for Tax year 2021.

I paid estimated tax of $9000 on 1/21/2022 (deadline is 1/18/2022) but the IRS notice shows lesser amount/credit of $8820. Does IRS automatically deduct penalty if the estimated tax payment is late? Is this normal?

While preparing my fed return using turbotax I entered estimated tax payment with the date 1/21/2022. On the Form 1040 Line #38 Estimated tax penalty shows 0. Turbotax does not seem to calculate the estimated tax penalty properly if the above the IRS credit as listed above is accurate.

IRS phone line seems to be busy to get a clarification. So wanted to find out if this is a calculation error on IRS end or I should be paying the penalty amount per the notice.

[bosso3]

I am not expert on this.  I will say that in my very limited experience with the IRS & penalties, they usually are correct.  Perhaps the following links can help.

https://www.irs.gov/individuals/understanding-your-cp23-notice  

https://www.irs.gov/payments/failure-to-pay-penalty

The above sites also have links to related sites.

If this does not meet your needs, and others do not answer more specifically, you may want to provide additional information:  when you filed your 2021 return, total tax due on your 2021 return, date of the CP23 notice and any explanation of their computation of the penalty.

You may be seeing a penalty, plus interest charges, or perhaps multiple penalty charges if you did not timely file your return.

Lastly, consider paying the penalty soon to stop the accrual of interest and then, if appropriate, contest the charges.

Good Luck

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[NCperson]

@AJ223  suggestions

1) go to your transcript on IRS.GOV and review what was credited.... 

2) check you bank account to confirm whether you truly paid $9000 or $8820.