Hi Bill,
You're correct; I do not owe an underpayment penalty to Indiana, and TTD did not state that I do. Between my withholding and my timely "quarterly" estimated tax payments, I paid 92% of my 2024 state taxes due. I will pay the balance when I file my state return.
The large majority of that 92% was paid in the form of estimated taxes. In fact, about 84% of my tax payments during 2024 resulted from estimated tax payments. This is because I am a retiree and completed Roth IRA conversions in 2024. I had identical monthly pension amounts and two large Roth conversions, one in Q1 and the other in Q4.
Consequently, my income was very unevenly earned throughout the year. All of my income was entered into TTD as annual amounts. TTD also knows my total withholding amount, and the amounts and timing of my four estimated tax payments.
As I mentioned previously, Indiana is a "pay as you go" state, meaning that tax payments must be made on a "per period" basis, such that they adequately match the income earned in each of those same tax periods. So, if a person's income is largely earned in Q1, that person cannot wait to pay their minimum 90% until Q4. They would be assessed underpayment penalties for Q1, Q2, and Q3.
That's the point of Indiana Schedule IT-2210A. When income is unevenly earned, did you pay adequate taxes in each period to match the income earned in each of those same periods, regardless of whether or not you met the minimum 90% threshold for that year?
And this is where I don't understand how TTD "thinks". Based on the information it has asked for, and that I have entered, it doesn't know how much income I earned in each of the tax "periods" in 2024. Also, completing Sections I and II of Schedule IT-2210A shows that I need to complete the remainder of the schedule to see whether or not I do owe a penalty.
So, that's where this all stands. I do appreciate your interest and responsiveness to my concerns, but at this point I think I'll just manually complete the IT-2210A myself. I do think, however, that this matter needs to be followed through at some point.
Thanks again!
