I had the same thing happen to me. I paid in 100% of my tax liability for 2024 but was assessed an underpayment penalty by TurboTax. I gather this is because I did not pay in 90% of my prior year (2023) tax liability, which is required in order to avoid a penalty. There are some exceptions to this 90% rule. Take a look at Form 2210 and the related instructions (you can access these at www.irs.gov). It can depend on how you paid your taxes in. If the taxes were paid by an employer or were paid via withholding on, for example, IRA or annuity distributions, then these taxes are deemed to have been paid throughout the calendar year. So the rule relating to quarterly estimated tax payments does not apply. However, I believe that the 90% rule still applies. Check your prior year return and determine whether you paid in 90% of your 2023 tax liability. If not, this could be the reason that TurboTax calculated an underpayment penalty. I actually submitted a comment to TurboTax that it would be very helpful - if TurboTax calculates an underpayment penalty - that TurboTax also explain the underlying analysis and why the penalty applies, and if there is an exception and - if not - why not.
