Doing 2018 Taxes & under the "Other Tax Situations" it auto-filled in a huge amount for something called "2017 Tax Liability". i don't understand this.

[SyberKnight]

am really nervous & confused by this. a previous screen already said i had a $130 "Underpayment Penalty" (because i don't pay quarterly, which is fine for me), but then to have this over $6k be populated in this 2017 tax liability field - what is that & how is it affecting how much i owe?  AND, why is it for 2017 when i'm doing my 2018 taxes??  i've been using turbotax online for many years; it has all my previous records; if i owed 6 grand in 2017, then why didn't it tell me that then? but still, that's a lot more than i've ever owed.  moving past this screen & leaving it filled in doesn't "seem" to affect my total owed (at this point).  i'm hoping somebody can explain this to me soon, as i need to finalize & file asap. thanks!

[BMcCalpin]

Please note that "2017 Tax Liability" was the amount of tax you were assessed, not the tax due when you filed. Most taxpayers have sufficient withholding that if they were assessed $6k in 2017, they probably owed only a small amount or had a refund. Look on your 2017 and see what your total tax is.

[SyberKnight]

thanks for the reply...  i looked at the 2017 turbotax summary page & it shows the "Total Tax" as an even higher number.  i don't wanna break protocol & give out inappropriate info here, but without giving some ballpark numbers, i'm gonna get confused.  so the "2017 Total Tax" was $7k'ish.  i owed & paid last year $4k'ish. so i'm still confused as to where this "2017 Tax Liability" of $6k'ish is coming from AND what i should do about it.   also, if the "2017 Total Tax" is an estimate/assessment, how is that done & why? TT calculates what i owe & i pay it.  sorry, i'm really not well educated in all of this. that's why i use TT, but every once in a while it throws a curve ball at me like this.

[BMcCalpin]

The 2017 Tax Liability that is shown on line 8 of form 2210 starts with the actual 2017 taxes assessed, then has a number of items added to it and subtracted from it. This means that the number on the 2210 in 2018 might not be found on the 2017 return nor derived from it in a simple fashion.

The formula for the 2017 tax liability entry on the 2018 2210 can be found on page 4 (line 😎 of the 2018 2210 Instructions at https://www.irs.gov/pub/irs-pdf/i2210.pdf. You will see how complex the calculations are.

[SyberKnight]

thanks again, but i'm still confused.  you're giving me line # & form # etc, but i don't know what that is nor how to find them.  i opened that pdf link & omg, i can't read/study all that, especially in the short amount of time left that i have.   it's now been a couple days since this happened, so i need to run back thru everything & see what happens again.  but until i do, can you at least answer why it's throwing in anything from 2017? i'm doing 2018 now. i submitted & paid for 2017 last year.   and, is this something i need to worry about or figure out or just let TurboTax do what it does with it & continue on? thx.

[BMcCalpin]

You said that you saw this number under "Other Tax Situations". You appear to be using TurboTax Self-employed Online. In this section, I had to guess where you saw this "2017 Tax Liability". I assumed it was under the subheading "Additional Tax Payments" in the section "Underpayment Penalties".

This means that you are dealing with the 2210, the calculation for underpayment of estimated taxes. The reason that information from your 2017 return is being sought is because one of the exceptions to the underpayment of estimated tax penalty is if the amount of tax you withheld and paid during the year was greater than or equal to the tax assessed in 2017. This is why you have those intense instructions, because you asked where this 2017 Tax Liability came from.

Like many things in tax, it is not simple. There is a good reason that TurboTax has fetched this number. Unless you have good reason to think that TurboTax did it wrong, I suggest that - as you said - "let TurboTax do what it does with it & continue on".

[SyberKnight]

thanks again for your thoughtful replies!   yeah, i suppose i should have mentioned more about my situation. both my wife & i work for ourselves, separately. she has her freelance biz & i have mine in a different field. last year i had to go on disability & did get back-pay for the previous year.  so perhaps all this new stuff i've not seen before is related to that.  i have inputed the SSA form info, & per other advice, am still filling in for both our businesses (even tho i didn't make but a few hundred bucks last year).  i've been unable to revisit this till now, but i plan to go back thru everything tonight/tomorrow & just click continue thru this section trusting turbotax 🙂