Hi Bill,
We're certainly in agreement about the rules for avoiding a tax penalty. So, for 2024, the total of one's credits (the sum of withholding and estimated tax payments), must be at least 1) 90% of 2024’s tax due or 2) 100% of 2023’s tax owed (110% if one's federal AGI is more than $150,000 if married filing jointly). However, unlike federal rules, where total credits can be spread evenly across the four quarters of the year, this requirement, in Indiana, must be met on a "per period" basis. That is, the amount of total tax credits each "period" must be sufficient for the amount of income earned in each of those same periods. So, for example, if a taxpayer underpays estimated taxes in the first period (Jan - Mar), that cannot be offset by overpaying in the second period (Jan - May), and a penalty would be assessed.
The total of my 2024 Indiana tax credits is more than 90% of my 2024 tax owed, but less than 100% of my total 2023 tax owed and paid. I also still owe more than $1,000 for 2024. So, I don't escape a penalty based on either of these two exceptions.
That's what's puzzling me at the moment. While TTD did ask me to enter the amount of each of my estimated Indiana tax payments per period, and the date on which I paid them, it never did ask me to enter my income for each of these same periods. Without that data, I don't know how TTD could determine that each of my estimated tax payments was sufficient for the income earned in that same period.
All that said, I do track my income and tax credits closely enough using an Excel model that I know I do not owe a tax penalty for 2024. TTD did not indicate that I do owe a penalty, and I did not expect it to do so. I just don't understand how TTD could have drawn that conclusion by not knowing my "per period" income, and then running through the appropriate IT-2210 schedule (by asking whether or not I wanted to annualize my income).
Does this make sense? Am I missing something here?
Thanks again!
