Is there anyway to avoid the penalty charges?

[VolvoGirl]

Which penalty?  For the Estimated Tax Penalty on 1040 line 38......

If you do not pay in enough tax from withholding and estimates, you may have to pay a penalty for underpayment of estimated tax. Even if you are getting a refund you can still owe a penalty for not paying in evenly during the year. Generally, most taxpayers will avoid this penalty if they owe less than $1,000 in tax after subtracting their withholdings and credits, or if they paid at least 90% of the tax for the current year, or 100% of the tax shown on the return for the prior year, whichever is smaller. It is included in your tax due or reduces your refund.

You might be able to eliminate it or at least reduce it. You can go to Federal Taxes tab or Personal tab, under Other Tax Situations and select Start by the Underpayment Penalties. You will answer a series of questions that may reduce or eliminate the penalty. Or you can elect to have the IRS figure the penalty for you. It's form 2210.

It's under

Federal or Personal (for Home & Business Desktop)

Other Tax Situations

Additional Tax Payments

Underpayment Penalties - Click the Start or update button

[rjs]

Exactly what penalty charges are you trying to avoid? We can't see your tax return, so we don't know what penalty you might have. VolvoGirl told you how you might be able to reduce the penalty for underpayment of estimated tax on Form 1040 line 38. Is that the penalty you are concerned about? Or are you asking about a different penalty, such as for an early distribution from an IRA, or for not taking a Required Minimum Distribution (RMD), or some other penalty? Where do you see the penalty that you want to avoid - on what form and line?

[rjs]

Are you trying to eliminate a penalty on your 2023 tax return, or are you trying to avoid a potential penalty that you think you might have on your 2024 tax return?

[Mike9241]

what tax year?