TLDR: Questions are in bold after dashes below.
I have been paying estimated taxes each quarter based on my income; however, my income in 4Q was much larger than my income in the first three quarters. The IRS and Arizona tax forms both originally assessed me penalties for late payment (under the assumption that I made the same amount each month). In order to remove the penalties for my Federal return, I “annualized” my income (for every few months) via the process in the Turbotax step-by-step (Federal Taxes > Other Tax Situations > Additional Tax Payments > Underpayment Penalties > Apply Special Circumstances). This process worked, and my Federal penalty disappeared. Unfortunately, Turbotax is not offering me the opportunity to “annualize” my income under my state tax Turbotax step-by-step for Arizona. (I can see AZ Form 221, p. 2 “Annualized Income Installment Worksheet” in the forms section of Turbotax. This form is the AZ analog of IRS Form 2210AI “Annualized Income Installment Method” that got filled out via the Federal step-by-step process).) I have also found a similar question posed for Tax year 2020 that says that Turbotax used to pose the question in an “Underpayment of Estimated Tax” screen just after the currently present “Donate to a Fund” step-by-step screen (https://ttlc.intuit.com/community/taxes/discussion/how-do-i-get-turbotax-to-let-me-access-arizona-fo...). After consulting the Help Line, I have been told that the AZ income annualization step-by-step screens should be incorporated into the AZ module in the future when the “Arizona Information Worksheet” shows it is Ready for E-File. (Here is the link for that status of Turbotax forms: https://form-status.app.intuit.com/tax-forms-availability/formsavailability?albRedirect=true&product... . If you select “1040” and “AZ”, the last entry in the list is the AZ Info Worksheet. Is does say “Unsupported” under “Ready for E-file?”” which I have been told really means “not yet completed”.
-Does anyone here know when the “AZ Info worksheet” should be completed? Or how long it took to be completed for their 2022 taxes?
-Can anyone here affirm that once the “AZ Info worksheet” is marked Ready for E-File that the “Underpayment of Estimated Tax” screen will appear under the State of AZ and I will be able to annualize my income via the step-by-step process in Turbotax?
Note: The Turbotax rep said that AZ Form 8879 “E-file Signature Authorization” must also become “Ready for E-File” for me to use the income annualization method, but this form sounds like one that every AZ taxpayer will need in order to e-file.
Thanks.
