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New Member
posted Jun 6, 2019 3:07:58 AM

We received MD income tax computation notice w/codes 205 & 207 (502UP, 500UP). Balance due $1,025.28 and we paid $1025.00. Total balance due is $65.19. Is this accurate?

If turbo tax is rounding down cents to the nearest dollar is that not accurate and should turbo tax have calculated our amount as $1025.28 and now we are paying $65.19 in penalties as a result? Thanks!

0 4 1972
1 Best answer
Level 15
Jun 6, 2019 3:07:59 AM

This has nothing to do with rounding.  A balance due of $1025.28 is more than the safe-harbor amount $500.  Presumably you did not meet one of the other safe harbors, so an underpayment penalty of something like $65.19 is to be expected.

http://taxes.marylandtaxes.com/Individual_Taxes/Individual_Tax_Types/Income_Tax/Payment_Information/...

Normally TurboTax calculates and includes in your balance due the expected underpayment penalty, but you have the option to tell TurboTax to omit the penalty and let Maryland calculate and bill for the penalty.

4 Replies
Level 15
Jun 6, 2019 3:07:59 AM

This has nothing to do with rounding.  A balance due of $1025.28 is more than the safe-harbor amount $500.  Presumably you did not meet one of the other safe harbors, so an underpayment penalty of something like $65.19 is to be expected.

http://taxes.marylandtaxes.com/Individual_Taxes/Individual_Tax_Types/Income_Tax/Payment_Information/...

Normally TurboTax calculates and includes in your balance due the expected underpayment penalty, but you have the option to tell TurboTax to omit the penalty and let Maryland calculate and bill for the penalty.

Level 15
Jun 6, 2019 3:08:01 AM

Oh that makes sense ... a failure to pay estimates penalty.

New Member
Jun 6, 2019 3:08:02 AM

But there is an issue with rounding DOWN on tax withheld and rounding UP on quarterly payments causing them NEVER to equal and keeps you in a loop!! I had to reduce by 1.00 to make it go so I’m owed 1.00 by turbo tax!

Level 15
Jun 6, 2019 3:08:04 AM

Rounding is allowed so call the state and point out the absurd penalty for .28 cents and they should remove it.