I am trying to figure out what is included in the penalty calculated by Turbotax and reported in line 38. Is this the late payment penalty or late payment interest or both?
Thanks!
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The amount on Line 38 is the underpayment of taxes penalty. It does not include any interest.
Go to this IRS Tax Topic for the underpayment tax penalty - https://www.irs.gov/taxtopics/tc306
If you owe taxes on the 2023 tax return, those taxes were due and payable on April 15, 2024. Once the IRS receives your tax return and the tax payment they will be sending you a bill in the mail for the failure to pay penalty and any interest owed.
Thank you!
Therefore, the amount in line 38 does not include either the late payment penalty or late payment interest; is that correct?
@Stsxoz wrote:
Thank you!
Therefore, the amount in line 38 does not include either the late payment penalty or late payment interest; is that correct?
That is correct.
Thank you!
This will be the first time I will be paying taxes on a return I am preparing with Turbotax. Do I have the option of calculating and adding the penalty and interest to the payment while completing the payment on TT?
@Stsxoz wrote:
Thank you!
This will be the first time I will be paying taxes on a return I am preparing with Turbotax. Do I have the option of calculating and adding the penalty and interest to the payment while completing the payment on TT?
There is no where on a tax return to indicate that a payment is being made for penalties or interest.
It is the IRS that calculates the amount of penalty and interest owed after they receive the tax payment.
Go to this IRS Tax Topic which has a wealth of information concerning penalties and interest - https://www.irs.gov/taxtopics/tc653
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