My only source of income in 2020 was from employer - salary + RSU shares. The salary had automatic deductions monthly, and the RSU had sell to cover with ended in $40 loss in 2 quarters. There is no other source of income or property tax or anything. Until now I have not received any underpayment penalty and the setup has been the same for at least 10 years. I paid all my due taxes by the filing time as well, and did not get any letter from the IRS about the underpayment penalty or how it was calculated, but turbotax shows that I have a $43 underpayment penalty. I have been looking through articles in turbotax and IRS, but not able to figure out how/why this was calculated, and if I am get to hit with a much bigger penalty for 2021 as things changed and I owe more taxes than 2020 (that will also be filed on time). Any help is appreciated.
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Please clarify what you are trying to do?
Did you pay estimated taxes monthly? That is unusual.
Were these income taxes or property taxes paid in escrow?
Please give more details.
Apologies, first time here. updated with details.
Only thing we can say is look at the withholding that was made in 2020 compared to prior years. The only explanation is a smaller percentage of income withheld.
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