NH DP-10 says I owe a penalty for not estimating taxes on Int & Div I didn't receive until Nov '22 and Jan '23. Is this a programming error?

[juliegnh]

I am not sure how I could have paid estimated taxes on unexpected dividends I received in Nov (from inherited stock) and a K-1 with interest & dividends I just got in Jan '23.  In prior years I didn't owe over the $500 limit so wasn't required to file estimated taxes (not that I could have, since I had no idea that I was going to get the stock and K-1).  My penalty for NH is $259.  Should I be asking Intuit if this is an error in programming???

[DMarkM1]

Yes, you can annualize the income to show you did not receive it until the end of the year in the NH state return.

1. In the "Interest and Dividends Tax" section Update the "Underpayment for Taxes on Interest and Dividends."
2. At the page titled "Underpayment Penalty DP-10 and click "NO" you do not want the IRS to figure your penalty.
3. Select "Tax on annualized income"
4. Fill in the boxes based on the dates the dividends were received.  

Note as the page instructs, these boxes are cumulative. So once you put an amount in a box it carries through the remaining boxes other dividends are added to it.  

If all were received after 9/30/2022 then put zeroes in all the boxes and continue.

[juliegnh]

Thank you!  I will give that a try and report back!

[juliegnh]

Well, it still shows I owe $259 in penalties.  Maybe I should clarify that I rec'd int & div throughout year normally.  It is just that there was additional int & divs rec'd  specifically on 11/15/22 and in a K-1 I rec'd on 1/26/23.  Up until these 2 events, I would have owed under the $500 limit in NH to have to pay estimated taxes.   The Tax on Annualized income  form you asked me to fill in doesn't even address the 11/15 date.  The boxes are:

1/1 to 3/31/22

1/1 to 3/31/22

1/1 to 6/30/22

1/1 to 9/30/22

If I filled them in correctly, the first 2 have the same dates, so get the same amount.  The 3rd is an accumulation of 1, 2 plus April to June?  And the 4th gets the previous 3 plus July thru Sept.?

Where do I account for the 11/15 Dividend and the HUGE amounts on the K-1?

I guess I can't figure out how we are separating out the 1 events on 11/15/22 and 1/26/23 if they aren't part of the calculation?  

[AmyC]

Receiving a k-1 simply states what you received throughout the year. It does not tell you when you received the income, you have to know that. Once you determine monthly, quarterly, etc then you can add that into your annualization method. 

As for the lump sum in Nov, it will be in the 4th quarter calculations which the computer knows is the total minus the first 3 quarters.

Once you enter the correct numbers in for the first 3 quarters, the program will calculate your penalty. Since you say it was a huge amount on the k-1, you very well received it throughout the year, rather than the last quarter. Check your statements.

[juliegnh]

Spoke with NH DOR Friday.  Since the amounts that put me over the $500 limit for having to send quarterly estimated payments happened in November, they instructed me to put the Total Gross NH income into the 4th box and then it calculated I only owed $29 in penalties vs the $529 since the Tax program calculates penalties as if you owed estimated payments the entire year.  I guess that fact that the 1099s and 1099-INT  aren't entered into TTax with any dates, it would be impossible to determine this, so NH has a DP-2210 to recoup some of the penalties in this type of situation.  Nightmare over.