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qichengyu
New Member

underpayement penaulty unchanged even if i pay the balance now

I have a tax balance due of $11000 and a underpayment penaulty of $171. I am thinking if I pay the balance today (02/25/24) instead of on 04/15, my penaulty will be reduced.

 

So I tried to enter that I am paying the balance today. Turbotax then recalculated thre penaulty to be $168. I am confused. If i owe $11000 for 50 days less, the interest diffference should be more that $3. What is the reason that there is hardly any difference? Thanks you.

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1 Reply
AmyC
Expert Alumni

underpayement penaulty unchanged even if i pay the balance now

There are different types of penalties and interest The IRS imposes penalties when you owe more than $1,000. The IRS considers owing $5,000 or more substantial and has higher penalties. You should have paid the amount throughout 2023 so that less than $1,000 was due by April 15. It isn't a matter of you paying a few days early, it is a matter of you paying months late.

 

Reference:

Information on Penalties

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