Does TurboTax desktop automatically include interest owed in the federal and state "tax due" calculation?

[AdamHurwitz]

I filed on-time federal and state extensions. Since then I've discovered I need to make additional tax payments as the federal and state "tax due" has updated while working on my taxes with TurboTax desktop.

Does TurboTax desktop automatically include interested in these estimates or do I need to manually calculate the added interest before making additional federal and state payments?

Much appreciated!

[DoninGA · Accepted solution]

TurboTax does Not calculate any penalties or interest on taxes owed.  There is no need for you to do so since the IRS will send you a bill for any penalty or interest after they receive the tax payment and the tax return.

[AdamHurwitz]

TurboTax calculates and includes any underpayment penalties in the shown "Federal Tax Due": "The balance due on your return includes this penalty." I believe to @DoninGA's point above this does not include failure to pay penalties. The penalties in the screenshot below only covers the category of failure to pay proper estimated tax.

See TurboTax desktop > "Personal" tab > "Other Tax Situations" > "Additional Tax Payments" section > "Underpayment penalties"

[AdamHurwitz]

It seems like it could be a good idea to estimate and pay the federal and state interest and penalties even if it means overpaying to attempt to avoid any future interest and penalties.

[VolvoGirl]

Add more to your payment (check or online).  Then let the IRS bill you for more or send you a refund. The extra interest and penalties stop they get your payment.  Its common and expected to let the IRS bill you for any more.