Question on withholding tax from a jobless person

[cririuss_ca]

I was (and is still) jobless for the tax year 2025.  

I was laid off in July 2024 and received unemployment benefits from August 2024 to February 2025.   In  2025 my withholding tax only consists of the taxes withheld from my unemployment benefits.   I just finished entering my tax info for 2025 Turbo Tax and discovered that I might have missed paying withholding tax even if  I am jobless?    I  did a Roth Conversion from my traditional IRA  last September 2025 in order to qualify for Affordable Care Act (ACA) health coverage.   

[VolvoGirl]

Did you have any tax withholding taken out of the ROTH conversion?   That was taxable.   You might owe more tax on the conversion.   And you might have needed to pay back some of the ACA insurance credit.   

[cririuss_ca]

yes, I do actually have to pay some back of the ACA insurance credit,  because my income (mostly generated by the Roth conversion - which is considered income) is way over  my declared estimated income.  

But i hope i  can avoid any penalty for not paying withholding taxes for the Roth Conversion as long I pay all my taxes in full  by the tax deadline? 

[VolvoGirl · Accepted solution]

If you get a penalty on 1040 line 38……

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

If you have the desktop program you can switch to Forms Mode (click forms in the upper right (left for Mac)) and open the 2210 form.  If the 2210 doesn't show up in the left column, click on Open Forms at the top of the left column.  Type 2210 in the search box and open the 2210 form.  Check box C if you want to let the IRS calculate it.

[cririuss_ca]

Yes, I see a penalty charge in line 38.  

thank you @VolvoGirl ! 

[cririuss_ca]

hi @VolvoGirl  just curious  - does TurboTax compute a higher penalty tax than the IRS (I hope so)?