Feedback Regarding 2025 Estimated Tax Penalty Calculation

Forum|Forum|2 months ago
May 9, 2026
1 reply
1470 views

I recently filed my 2025 federal return using TurboTax and paid the amount calculated by the software, including an estimated tax penalty.

I later received IRS Notice CP30A stating that the IRS recalculated the estimated tax penalty and reduced it, resulting in an additional refund of $184.

I understand that estimated tax penalty calculations can sometimes differ depending on IRS computation methods. However, I wanted to provide feedback because I relied on the TurboTax calculation in determining my payment amount, and the IRS ultimately determined the penalty was lower.

I would appreciate any clarification regarding why TurboTax’s calculation may have differed from the IRS computation in this situation.

Thank you.

VolvoGirl

Level 15

The underpayment penalty amount Turbo Tax calculates on your 1040 or state is only an estimate. Turbo Tax can not figure it accurately because they don't know exactly when the IRS or state will get your return and tax due payment. And Turbo Tax doesn’t know when you received the income. The income needs to be broken out by quarter. It's very common and normal and expected for the IRS or state to bill you for more or send you a refund.

If Turbo Tax calculates a penalty on 1040 line 38…..You might be able to eliminate it or at least reduce it. You can go to Federal Taxes tab or Personal tab, under Other Tax Situations and select Start by the Underpayment Penalties. You will answer a series of questions that may reduce or eliminate the penalty. Or you can elect to have the IRS figure the penalty for you. It's form 2210.

It's under

Federal or Personal (for Home & Business Desktop)

Other Tax Situations

Additional Tax Payments

Underpayment Penalties - Click the Start or update button

rib123Author

Level 2

Thanks for the prompt reply. The reply surprised me, as I had never had a calculation issue for 20+ issues with an accountant. For the 2025 tax report, I used TruboTax for the first time. If the explanation is correct, TurboTax has exhausted the IRS's resources when its calculation is just a good guess while advertising 100% accuracy.

baldietax

Level 12

Turbotax uses Form 2210 but IRS uses its own records for the inputs to the safe harbor and penalty calculation. If there is any difference in the data, e.g. 2024 tax info, timing of estimated/final tax payments vs. what was input into Turbotax, then IRS may get a different result.

If you used Turbotax for the first time in 2025, did you go through the underpayment section in Other Tax Situations / Underpayment Penalties which includes confirmation of 2024 tax/AGI used on Form 2210.

You can check your transcript/payment history on your account at irs.gov to see if anything would account for the difference. If you are using desktop you can see the Form 2210 in Forms mode, it's not filed unless you have one of the exceptions, AI method etc.