IRS says I owe a penalty. TurboTax did not calculate this. I feel like there should be a guarantee, is there one?

[lythompson]

I would have checked more carefully my quarterly income if I knew I'd have a penalty. But TurboTax said I didn't. Now I have a bill for $1350.

[Critter-3]

The TT program calculates an estimated underpayment penalty based on the information you enter in the program  however the fed/state reserve the right to calculate an actual underpayment penalty based off the information they have on file (and based on when the balance due was actually paid)  along with a late filing penalty,  late payment penalty  plus interest they deem needed.  This is not a program error and is not covered by the accuracy guarantee.  

[Mike9241]

submit a claim to Turbotax. However, this may be a situation where you are at fault and not Turbotax. it could even be an IRS error.

https://www.bing.com/search?pglt=43&q=how+to+submit+claim+to+Turbotax&cvid=5f5bc53f30ef4773bd127eb1a... 

[fanfare]

Form 2210 is the form for Estimated Tax Penalty.

Form 2210, by default,  requires evenly spread (Estimated tax + withholding) installments  of no less than the minimum amount.

If you did not see a penalty on 1040 Line 38, I would say TurboTax is deficient.

@lythompson 

[Critter-3]

TT may not have been deficient  if you made any  input errors or overrode the penalty calculation.  

[NCperson]

@lythompson - let me understand.... you beleive TT should guarentee your failure to check the quarterly payments more carefully?????? 

[Critter-3]

The program does address this situation but you can always not make the payment suggested ... the next year the program assumes you made the payments suggested the prior year but you are required to confirm that the payments were made if any were made.

To enter, edit or delete estimated taxes paid (Federal, State, Local) -

• Click on Federal Taxes (Personal using Home and Business)
• Click on Deductions and Credits
• Click on I'll choose what I work on (if shown)
• Scroll down to Estimates and Other Taxes Paid
• On Estimates, click on the start or update button

Or enter estimates paid in the Search box located in the upper right of the online program screen. Click on Jump to estimates paid

Or click on Tax Tools on the left side of the online program screen.
Click on Tools
Click on Topic Search
Type in estimated tax payments, click on GO

How do I make estimated tax payments?

https://ttlc.intuit.com/community/tax-payments/help/how-do-i-make-estimated-tax-payments/00/25875

When are federal estimated taxes for individual returns due?

https://ttlc.intuit.com/community/tax-payments/help/when-are-estimated-taxes-due/00/25857

Can TurboTax calculate next year's federal estimated taxes?

https://ttlc.intuit.com/community/tax-payments/help/can-turbotax-calculate-next-year-s-federal-estim...

Can TurboTax calculate the estimated payments for next year's state taxes?

https://ttlc.intuit.com/community/tax-payments/help/can-turbotax-calculate-the-estimated-payments-fo...

[lythompson]

Not sure where you got that idea. 

I have used TT for 25 years and it calculates a penalty if you owe one, and that gives you a chance to input your quarterly income and then recalculates the penalty. I recall doing that and it recalculated my penalty as zero. 

So I’m annoyed that it was wrong. It’s probably not worth the hassle for such a small penalty, it’s more the principal of it. I trust TT. 

also, maybe therapy for you?

[lythompson]

Thanks. Yeah I always send in money in December once I know my income (mutual funds). This year it was $200k I sent in and I owed maybe $10k in April so was pretty close. 

[Critter-3]

@lythompson 

Ok ... that is more to the story we can work with.   If you completed the 2210AI  in the program ( which uses your inputs to calculate the penalty)  and the IRS doesn't agree with your assertions  then you need to disagree with their determinations.  The penalty notice gives you the method to disagree with their findings ... make sure to respond timely.  

I GOT A LETTER FROM THE IRS   

https://ttlc.intuit.com/questions/3605673-i-got-a-letter-or-notice-from-the-irs

I AM BEING AUDITED

If you purchased Audit Defense:

https://ttlc.intuit.com/questions/2924451-i-bought-max-or-audit-defense-and-now-i-m-being-audited

AUDIT SUPPORT

https://support.turbotax.intuit.com/irs-notice/audit-support/

[NCperson]

@lythompson - did you complete form 2210 correctly?  if your income is 'lumpy' which sounds like it might be, then in Part 2 of this form, checkbox "C" should have been checked and then Form 2210AI should have been completed.  That usually results in lower / no penalty. 

I imagine you can still amend if this didn't occur.