Where did you select "no" for the estimated tax penalty? What part of the interview were you in? What was the heading of the screen where you were asked this question?
I have similar question about line 38 penalty. We have variable income that is not resolved until working out 2022 tax form. However, I always am sure to withhold as much tax as was due the previous year (2021). This should exempt me from paying this penalty. Yet TT wants to add this penalty to our taxes due. Can you help?
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
If you have the desktop program you can switch to Forms Mode (click forms in the upper right (left for Mac)) and open the 2210 form. If the 2210 doesn't show up in the left column, click on Open Forms at the top of the left column. Type 2210 in the search box and open the 2210 form. Check box C to let the IRS calculate it.
Form 2210 https://www.irs.gov/pub/irs-pdf/f2210.pdf
Instructions https://www.irs.gov/pub/irs-pdf/i2210.pdf
Thank you for your help. I missed that line about underpayment penalty. Last time I under withheld, one just referred to an exemption #? and skipped the penalty. This time I worked through annualizing withholding by exact dates and it reduced the penalty to $19. Acceptable. Thanks again for your rapid help!