After completing a ROTH IRA conversion in December (last December), TurboTax indicated that I owe ~$3,000 in California state tax. Because this amount is ~15% of the current tax year’s (2024’s) total tax (~$18,000), hence, I will need to pay a penalty for insufficient tax withholding.
TurboTax calculates this penalty to be $60, which is much less than I expected. I thought the penalty is 8% of the tax owed, which should be $240. My prior year’s (2023’s) California total tax was ~$3,800.
If I pay the penalty plus what I owe would there be any additional interests or charges if I e-file before April 15? I’m assuming that I can pay the penalty plus what I owe when I e-file with TurboTax.
Is it still possible to make the 4th quarter estimated payment even thought I didn’t make any payments for the previous 3 quarters? I under there may be an estimate penalty. Using TurboTax, I compared the penalty for (a) no 4th quarter estimated payment versus (b) paying the 4th quarter estimated payment. Surprisingly the penalty didn’t differ much (a) $60 penalty and (b) $40 penalty. Does this seem right?
