You would make an estimated payment by January 15. Then when you file your return, complete a penalty calculation using the "annualized income method." Do this for both the IRS and the state. Turbotax may not be automatically recognizing that this is a federal penalty situation, but it probably is.
By default, income is assumed to be earned evenly over the year, but payments are only recorded when they are made. That means that if you did a $30,000 conversion in December 2024, both California and the IRS will assume that you should have made estimated payments for April 15, 2024, June 15, September 15, and January 15, 2025. So that $3000 of CA tax should have been paid in 4 equal installments of $750. Likewise, you probably owe about $6600 of federal income tax that was due in 4 equal installment of $1650. The penalty is roughly 1% per month of the overdue amount, so 9% on the first $750, 7% on the second $750, and so on (and the same for federal).
The annualized income method breaks down your income and payments (withholding plus payments) by quarters and shows that your income was uneven and the payments for each quarter were appropriate for the income in that quarter.
So you need to make a CA estimated payment by January 15, and probably a federal estimated payment, and then run both the federal and state penalty calculations using the annualized income method.
