Tax Due on Underpayment

Forum|Forum|5 years ago
August 26, 2021
7 replies
48 views

I have calculated interest due to 09/15/2021 on underpayment of taxes due on 04/15/2021. Where do I report the interest on my return?

TurboTax Home & Biz Windows

Best answer by VolvoGirl

You don't. Turbo Tax will calculate an estimated penalty for underpayment on 1040 line 38. Then the IRS will send you a bill (or refund) for any more. Let the IRS bill you. Your calculation might not match the IRS.

VolvoGirlAnswer

Level 15

JPM854Author

Level 2

Good advice--thanks!

DanPaul02

Level 8

Interest paid in 2021 will be reported on 2021 tax return.

VolvoGirl

Level 15

Any IRS interest actually paid does not go on any tax return. It is not reported or deductible. Now if the IRS paid you some interest for sending you a refund late the interest is taxable income the year you received it.

rjs

Level 15

@JPM854 wrote:

I have calculated interest due to 09/15/2021 on underpayment of taxes due on 04/15/2021.

Taxes were due 5/17/21. The payment deadline was extended for this year only. Let the IRS calculate the interest.

@JPM854 wrote:

Where do I report the interest on my return?

There is no place on the tax return to report the interest. Just pay what the tax return says you owe (Form 1040 line 37). The IRS will send you a bill for the interest. If it's a small amount they might not bother collecting it.

Mike9241

Level 15

your calculations will be wrong for a1040. any balance owed was due 5/17/2021. let the IRS figure it. if it's small enough they might not even bill you because the cost of sending out the bill would be more than the bill itself. also, we're not sure what penalty you're referring to. there is a penalty for underpayment of estimated taxes and a different penalty for not paying the balance due by the 5/17/2021 due date. Turbotax only calculated the estimated tax penalty.

Mike9241