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Yes, the penalties for tax mistakes are often based on a percentage of the underpaid tax, but it's not the only factor. The IRS uses these percentages to decide the penalty amount, and the rate depends on the type of mistake you made. https://www.irs.gov/payments/penalties    Accuracy-Related Penalty (most common) Rate: 20% of the underpaid tax due to negligence, substantial understatement, or disregard of rules. Fraud Penalty Rate: Up to 75% of the underpaid tax if fraud is proven. This is reserved for cases where there is clear intent to deceive the IRS. The IRS calculates interest on unpaid taxes starting from the original due date of the tax return, regardless of whether you filed an extension. This means that even if you received an extension to file, interest on any unpaid taxes starts accruing on the original due date, typically April 15. The interest rate the IRS uses is tied to the federal short-term interest rate, which is determined quarterly. To this short-term rate, the IRS adds an additional 3%.   The IRS also considers whether you have a history of compliance and if there was a "reasonable cause" for the mistake. If you can show you had a good reason for the error (like a natural disaster, serious illness, or an inability to get records), the IRS may reduce or remove the penalty. Also, remember that interest on the unpaid tax and any penalties adds up daily until you pay the full amount. https://www.irs.gov/payments/penalty-relief   @user17581195285 Thanks for the question!!

I know now that I should have waited, but this was my first ever amended return. When the amended return was filed using TurboTax, the $1,800 was the total tax owed. I thought it would supersede the previous return, but both the original amount owed and then the new, larger amount owed were both withdrawn in two separate transactions. Thus, the IRS has $1,200 of additional payment. I am concerned that the $1,200 is labeled as Balance Payment rather than Estimated Tax Payment on the IRS site.   Audit Defense won't get involved unless I'm audited.

What kind of 1099 do you have? There are over 20 different kinds. There is no plain Form 1099. All 1099 forms have one or more letters after the 1099. The most common are 1099-INT, 1099-DIV, 1099-B, 1099-NEC, 1099-R, and 1099-G.  

Unfortunately, no, there is not further extensions available.  If you file after the deadline, and have a balance due, the IRS and state will assess failure to file penalties. Also, extensions do not extend the deadline to pay, so failure to pay penalties will apply back to April 15, 2025 (for the 2024 tax return). If you are due refunds, there is no penalty for filing after the deadline. Generally, returns claiming a refund must be filed within 3 years of the original filing date (for 2024 returns, originally due April 15, 2025, this would be by April 15, 2028).

Penalties and amounts are based on the type of mistake you make. Many are based on the percentage of the unpaid or underpaid tax. Some of the penalties are fixed while others are a percentage. The IRS determines penalties based on the specific type of non-compliance, such as: Failure to file a return on time Failure to pay taxes owed Understating your tax liability Intentionally misreporting information (fraud)  Failure to file is 5% of unpaid tax  per month or part of the month the return is late per month or , upto 25% with minimum 60 day late penalty. Failure to pay is 0.5% of unpaid tax  per month or part of the month the return is late per month, also capped at 25%. But when both penalties apply, the combined penalty for the month is 5%. Accuracy related penalty applies when you under pay your tax,  and is generally 20% of the underpayment attributed to negligence, disregard of rules, or a substantial understatement of tax. A substantial understatement for individuals is when the amount is more than 10% of the correct tax or $5,000, whichever is greater. A higher penalty rate of 40% applies for gross valuation misstatements.  Underpayment penalty of estimated taxes applies if you did not pay enough taxes throughout the year. The interest is per quarter and the IRS has interest rates set for each quarter.

You have the option to request an IRS representative initiate a Form W2 complaint. Call the IRS at (800)-829-1040 or go to the link: IRS Tax payer assistance center).   Follow this link from the IRS for further guidance:  Incorrect W2 FAQ.   You should obtain a copy of your W2 transcript from your IRS online account:     If you do not have an account, you can create one through the following steps:   Go to this address (cut and paste into browser): https://www.irs.gov/your-account  Select the blue box, Sign in to online account" in the Individual box Select ID.me Create an account" This will open a page titled, "ID.me + IRS - Create an ID.me account" Select the blue button for "Create account" and follow the instructions. You will need your ID and a smart phone for easy account creation.   Once you have logged in, you can see your transcripts through the Tax Records section under an option, Transcripts. You can compare the incorrect W2 to the IRS transcripts for reference during your call with the IRS.   You will need your employer or payer’s information as well as your information ready for the IRS representative.

If your W-2 was corrected, it is best to wait until you receive it before filing your tax return. Can you ask your employer for a copy of the corrected W-2?    If you have not received the corrected W-2, the IRS offers guidance in this article: If you don’t get a W-2 or your W-2 is wrong    When you say that you want to report the corrected W-2 on Form 1040-ES, I assume you mean Form 1040 instead. Here is the difference between Form 1040 and Form 1040-ES:   Form 1040 is used to file your tax return for a specific tax year. It's how you report your total income, claim deductions and credits, and figure your final tax liability. Any W-2s you receive would be reported on Form 1040.   Form 1040-ES is used to calculate and make quarterly estimated tax payments. A W-2 would not be reported on Form 1040-ES.   Here is an article that discusses Form 1040-ES in greater detail: What is IRS Form 1040-ES: Estimated Tax for Individuals?

Hello i did submit a claim and they are only trying to pay $400 but this bill is 100% turbo tax’s fault so why should I be responsible for the $3,040? I would be fine paying the interest which is the $400 but they are trying to get me to pay for the full amount.

You cannot change the tax year.   The current online program is for 2024 only.   Only a 2024 return can be prepared online and only a 2024 return can be e-filed.   Online preparation and e-filing for 2021, 2022, and  2023 is permanently closed. Note:  The desktop software you need to prepare the prior year return must be installed/downloaded to a full PC or Mac.  It cannot be used on a mobile device.   To file a return for a prior tax year  If you need to prepare a return for 2021, 2022, or 2023  you can purchase and download desktop software to do it, then print, sign,  and mail the return(s) https://turbotax.intuit.com/personal-taxes/past-years-products/ You may also want to explore purchasing the software from various retailers such as Amazon, Costco, Best Buy, Walmart, Sam’s, etc.   Remember to prepare your state return as well—if you live in a state that has a state income tax.   https://ttlc.intuit.com/turbotax-support/en-us/help-article/state-taxes/contact-state-department-revenue/L9qVToi02_US_en_US?uid=m6e06um0   When you mail a tax return, you need to attach any documents showing tax withheld, such as your W-2’s or any 1099’s.  Use a mailing service that will track it, such as certified mail so you will know the IRS/state received the return.   Federal and state returns must be in separate envelopes and they are mailed to different addresses.  Read the mailing instructions that print with your tax return carefully so you mail them to the right addresses.