Why is TurboTax telling me to make estimated tax payments in 2018, when I am getting a refund for my 2017 taxes? Do I still need to prepay taxes if I am due a refund?

[lytleric]

TurboTax is recommending I make estimated tax payments in 2018.  When I decline this, it then asks "Are you SURE you do not want to prepare estimated taxes for 2018?" and tells me that my tax situation suggests that I should and if I do not, I may owe an underpayment penalty. 

However, TurboTax has also calculated that I am due a federal refund.  Why would I need to pay estimated taxes in 2018, if I've actually overpaid in 2017?  What is the logic?

[Kat]

The program prints those vouchers as a suggestion.  If you are certain that you don't need to make estimated tax payments, just disregard those vouchers.  See the TurboTax FAQ below for additional explanation.

https://ttlc.intuit.com/replies/3301872

[lytleric]

That's exactly my point.  I don't THINK I need to make estimated tax payments, since I am due a refund, which means I overpaid in 2017.  But TurboTax seems to be suggesting that I underpaid in 2017 by strongly recommending I make estimated payments in 2018. Shouldn't it know that my tax situation shows that I am in fact paying enough?  It doesn't give me a lot of confidence that I am making the right decisions...

[Kat]

If you are receiving a refund from your 2017 return, don't give it another thought.  If you NEED to make estimated tax payments in 2018, you can either use those pre-printed vouchers or pay your estimated taxes through the IRS website.  

See this:
<a rel="nofollow" target="_blank" href="https://ttlc.intuit.com/questions/1901110-do-i-need-to-make-estimated-tax-payments-to-the-irs">https...>

[VolvoGirl]

If you are receiving a refund or low tax due and TurboTax prepared the vouchers then your tax liability was probably reduced by credits. Your Tax Liability is the amount on 1040 line 44.  It is the tax you owe on your income.  But you might qualify for credits that can reduce your tax due or even give you a refund.  Credits are on lines 47-55.

You can ignore them.  The estimated payments are optional to pay. They are estimates for next year. Turbo Tax doesn't want you to owe next year. They might have printed out if you got a one time large income this year. Like if you took a IRA or 401K distribution.  They DO NOT get sent to the IRS or state with your return.

[joseybell]

Thanks for the additional details.  We took a distribution from an IRA and that is what must have triggered the payment vouchers, even though we got a refund.

[maukro]

I also took a large distribution from my 401k this year and rolled it immediately over to an IRA, and this year, TurboTax keeps "insisting" that I need to make large Estimated Tax payments for 2021. I came to this forum to research this very question. Sure enough, it seems to be the 401k distribution that triggered TurboTax's "insistence." It's a little annoying. The program KNOWS I rolled the distribution over and that it's a non-taxable event. So .... Oh, well. I just thought I'd chime in, too, in case others encounter the same thing.