Form 2210: avoiding underpayment penalty

[ccorless]

I paidmore than 110% of my 2021 tax total, however, TurboTax is telling me I have $118 underpayment penalty. Why?

Details: I had large long-term capital gain in May. I paid a single estimated payment by June 15 to ensure I would achieve the 110% safe harbor threshold, but it's still listing a penalty. How do I fix this?

[Vanessa A]

You will need to go through the penalty waiver form 2210 to get rid of the penalty.  You can do this one of 2 ways.  At the end of the return, TurboTax will say lets see if you qualify to remove or reduce this penalty.  Here you can answer yes and then walk through the questions telling TurboTax your 2021 Income tax amount and the payments that you made.  You can also go to Other Tax Situations>>Penalty Waiver and fill out the form.  This will allow you to answer questions to reduce or eliminate the penalty. 

[fanfare]

the prior years tax rule requires equal payments over the four estimated tax periods.

Since you did not do that, then you can resort to Schedule AI; this is not guaranteed to eliminate the penalty.

@ccorless