form 2210 error on line 14 columns a,b and c

[mcd3]

I have created a hypothetical for just the first column (Jan - Mar) on Form 2210 AI to show that Turbotax is not calculating the amount on line 14 correctly. This is the case for the 2d and 3d column as well.

Form 2210 AI

line 1 Gross income Jan-Mar                                    $35,000

line 2 Annualization rate                                               x4

Line 3  Annualized Gross Income                            $140,000

line 7 Annualized Std deduction                                 $12,550

line 11 Annualized Taxable Income                          $127,450

Capital gains (not annualized)                                 $     2,000 Shown in Tax Computation worksheet box

Qualified dividends (not annualized)                               $ 200  Shown in Tax Computation worksheet box

Correct Line 14 Tax calculation

Gross income (annualized)                                                 $127,450                                          Tax

Capital gains (annualized)    $2,000 x 4                             $    8,000  x 15%                           $  1,200      

Qualified dividends (annualized)  $200 x 4                          $     800  x 15%                            $    120

Income subject to regular tax(annualized)                          $118,650  x 24% less $$5,979      $22,497 

                                                                                                                                    Total       $23,817

                                                   Tax calculated by Turbotax   (updated 3/12/22)                 $24,357

Turbotax Line 14 Tax calculation

Gross income (annualized)                                                   $127,450                                          Tax

Capital gains ( not annualized)    $2,000                            $    2,000  x 15%                           $    300      

Qualified dividends (annualized)   $200 x 4                        $       800  x 15%                            $   120

Income subject to regular tax                                              $124,650  x 24% less $$5,979      $23,937

                                                                                                                                    Total       $24,357

                                                                                                                                    Difference   $540

Difference   Equal to difference in annualizing capital gains $6,000 times difference in

                      regular tax rate (24%) vs capital gains tax rate (15%)   9% = $5

[Cynthiad66]

Turbbo Tax is in the process of adjusting the Form 2210A1 and there is a link to signup for notifications about the progress.

Please use this link, HERE  to signup for notification when this form will be updated.  

What is form 2210a1?

Use Form 2210 to see if you owe a penalty for underpaying your estimated tax and, if you do, to figure the amount of the penalty.  The IRS will generally figure your penalty for you and you should not file Form 2210. You can, however, use Form 2210 to figure your penalty if you wish and include the penalty on your return. There are some situations in which you must file Form 2210, such as to request a waiver.

[mcd3]

This correction has still not been made and it is now Mar 19. It is taking too long to make this relatively simple correction.

[greg_s]

The form name is 2210AI not 2210A1

The link for notifications is no good

[Tax4fp]

As I have noted in several other forums, a simple workaround to get 2021 TT to properly calculate the effect of capital gains in the first three periods for Form 2210 and 2210AI is to simply report the total of the capital gains and qualified dividends in each of the first three periods as qualified dividends and enter zero for capital gains in each of these periods.  Since TT scales the value in the qualified dividends entry for each period, this will result in TT correctly calculating the effect of capital gains and qualified dividends per IRS instructions and result in a proper underpayment penalty calculation for each period.  The IRS accepted an e-filed return with this workaround.  Note that since scaling factor for the full year is 1, the fact that TT actually shows the capital gains as capital gain entry for the fourth period has no impact on Form 2210 calculations.  Using this workaround will allow you to e-file Federal return, rather than having to mail in forms (the IRS is way behind in processing mailed returns from multiple years, so they would much prefer that you e-file).  

[Tax4fp]

Update on 4/20/2022 finally fixed the tax calculation error in Form 2210AI line 14 (a)-(c) where LTCG was not being scaled each period as IRS required for these calculations.  Too late to help anyone who filed on or before due date for 2021 federal taxes.