I never had to pay the tax underpayment penalty in previous years, and now all of a sudden I do even though my income is more or less consistent? And it was quite a lot. Is this something new or recent? What is the rule for avoiding that? Yes, perhaps lately my interest from banks are higher as it increases every year but how am I supposed to withhold for bank CD earnings? Do I do a backup withholding or does that look bad? Do I just pay in advance estimated taxes to the IRS? I am afraid if I do the latter, I will lose that money that I paid and they won't consider that in my taxes for next year. And how would I go about doing that? Do I wait until my CD closes or do I pay the IRS as I get interest per month?
