I deducted taxes from salary (W2) properly. But, I did not pay taxes incrementally with investments (1099div). Do I owe an underpayment penalty related to the 1099?

Can big gains (revealed in 1099-div) result in an underpayment penalty? (Or are underpayment penalties only via the W2?)

1058

Expert Alumni

Apr 11, 2025 1:05:32 PM

Yes, the underpayment penalty applies to all income, so any investments or other income would require estimated taxes to avoid the penalty.