The IRS imposes underpayment penalties if you don't withhold or pay enough tax on income received each quarter. Even if you paid your tax bill in full by the April deadline or are getting a refund, you may still get an underpayment penalty. To possibly reduce or eliminate your underpayment penalty:
- Open or continue your return.
- Navigate to the underpayment penalty section:
- TurboTax Online/Mobile: Go to annualizing your tax.
- TurboTax Desktop: Select Search Topics. Search for and select annualizing your tax.
- We'll take you through the steps to possibly reduce what you owe.
In addition, for 2025 to get a clearer picture, you can use the IRS Tax Withholding Estimator to check if your current withholding is accurate. This tool can help you adjust your withholding to better match your tax liability.
[Edited 02/22/2025|5:56 pm PST] @ravinmist
