Underpayment penalty

Forum|Forum|2 months ago
July 15, 2026
1 reply
86 views

How does the safe harbor rule work to avoid under penalty if I have been filing jointly as married and then switch over to filing as a single next year? What tax does it look at to apply the 110% rule?

Loretta P

Employee Tax Expert

If you are switching from filing as Married Filing Joint (MFJ) to filing as Single (if you have divorced) or Married Filing Separate (MFS) (if you are married but not filing a joint return or your divorce is not final yet), the IRS requires you to look at your prior year return as if you had filed MFS to determine your portion of the prior year tax for safe harbor purposes.

This also applies when determining 110% versus 100% threshold, you are not just taking half the prior year adjusted gross income (AGI) but separating things out to determine what your portion of the AGI for the prior year was.

Page 65 of the IRS instructions for Form 1040 state you use 110% of the tax shown on your prior year return if you aren’t in the business of farming or fishing and your ADI is more than $150,000 for MFJ and Single or $75,000 for MFS.

Once you determine what your portion of the prior year return tax liability is you would compare that to 90% of your current year liability and whichever of these two numbers is smaller is your target.

The IRS does require you to provide your employer with a new W-4 upon status change (getting married, divorce, etc.)

Helpful Links:

Publication 505 (2026), Tax Withholding and Estimated Tax

IRS Instructions for Form 1040

20.1.3 Estimated Tax Penalties

[Edited 7/20/26 l 7:36AM]

@needtaxadvice

**Say "Thanks" by clicking the thumb icon in a post. **Mark the post that answers your question by clicking on "Mark as Best Answer"