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New Member
posted Oct 6, 2021 5:53:12 PM

How do I get Turbotax to let me access Arizona Form 221 Underpayment Penalty of Estimated Taxes by Individuals"?

Arizona charged me an underpayment penalty when TT said I didn't owe one. I paid 143% of my previous (2019) AZ taxes and 136% of the AZ taxes owed for 2020, but I did not pay in equal installments because I did a Roth conversion in late December, 2020. TT had me annualize my income for my federal return on Form 2210, but it did not prompt me to file AZ Form 221. I called AZ Dept of Revenue and they said the penalty was because I did not pay in equal installments and did not file AZ Form 221 to explain why I paid in unequal installments. This sounds like a bug in TT, even though it also sounds like AZ Dept of Revenue is not following their own "safe harbor" estimated tax law. So how can I force TT to let me access AZ Form 221 *AND* help me fill it out? I tried filling it out manually and it is very difficult, plus that would not let me be able to eFile. Thanks for any help.

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1 Replies
Level 8
Oct 12, 2021 4:56:22 PM

TurboTax will create Form AZ 221 if you choose the Annualized Income option in the Arizona section.

 

Near the end of Arizona, TurboTax will ask whether you want to Donate to a Fund.

  • You will next see Underpayment of Estimated Tax.
  • Continue through this section until you come to Annualized Income.
  • Say YES to Do you want to annualize your 2020 income? and fill in all the information of annualize your penalty to add AZ 221 to your return.