After you file

I'm very sorry for you loss.

There are several very good issues that you have brought up.

You're correct to be filling as Surviving Spouse.

Your Mom's income will be higher as an individual, but I can't be sure she will owe more taxes.

I'm going to start with the last item first.  Preparing a sample 2023 tax return.

• You can go online and set up a new TurboTax account.  
  • (Use a new ID and Password.  
  • You can then do your Mother's "What If" tax return at no charge.
• Prepare the sample tax return as single, and 
  • include her information and income 
  • plus what you expect will carry over from you Father. 
• This will help to resolve several of your issues:
  • You will prepare it a Single and get the lower Standard Deduction.
  • You will have included any carryover income from your Dad.
  • You will have accounted for any taxes that were withheld If you've already started to enter investment income, you can continue to add information by selecting [ + Add investment ] at the bottom of the page.

I'm sure you have this, but this is the IRS criteria for underpayment penalty

• Yes, you will make 4 equal estimated payments:
  • January 1 – March 31, 2024 - April 15, 2024
  • April 1 – May 31, 2024 - June 17, 2024
  • June 1 – August 31, 2024 - September 16, 2024
  • September 1 – December 31, 2024 - January 15, 2025

The underpayment penalty will be assessed if any of these apply:

• "If you don’t pay enough tax through withholding and estimated tax payments, you may have to pay a penalty."
• "You also may have to pay a penalty if your estimated tax payments are late, even if you are due a refund when you file your tax return."

To avid the under payment penalty:

• The amount you owe is less than $1,000, after subtracting withholding and refundable credits.
• You paid 90% of the tax that you owed for the current year.
• You paid 100% of the previous year tax, (110% for higher incomes).
• If your previous year's adjusted gross income was more than $150,000 you will have to pay in 110% of your previous year's taxes to satisfy the "safe-harbor" requirement.

"Typically, underpayment penalties are 5% of the underpaid amount, and they're capped at 25%. 

Underpaid taxes also accrue interest at a rate that the IRS sets annually."

To avoid this situation it is recommended that you adjust your W-4 with your employer or pay estimated taxes.

Underpayment of Estimated Tax by Individuals Penalty

Please contact us again with any additional questions.