Tax Penalty for 2019 taxes

[Jak29672]

I have complete my tax return for 2019.  I notice an estimated tax penalty.  Trying to figure out why i got it. The only predictable income i have is social security.  I do get some interest and dividend and some capital gains.  The amounts are unknown until the end of the yer.  I have paid my estimated tax payments based on what I paid in taxes the previous year.  I got that amount from TurboTax.

Main increase this year is capital gain near the and of the year.

So why do I have this tax penalty?

Thank you.

[DavidD66]

If you don’t pay enough tax through withholding and estimated tax payments, you may be charged a penalty. You also may be charged a penalty if your estimated tax payments are late, even if you are due a refund when you file your tax return.

Generally, an underpayment penalty can be avoided if you use the safe harbor rule for payments described below. The IRS will not charge an underpayment penalty if you pay at least:

• 90% of the tax you owe for the current year, or
• 100% of the tax you owed for the previous tax year.

This rule is altered slightly for high-income taxpayers. If the adjusted gross income on your previous year’s return is over $150,000 (over $75,000 if you are married filing separately), you must pay the lower of 90% of the tax shown on the current year’s return or 110% of the tax shown on the return for the previous year.

[Jak29672]

Thank you, it makes sense.  I pay estimated taxes on a quarterly basis based on an amount provided by Turbo Tax. Given the penalty it might be wiser for me to hire someone to do my taxes. Turbo Tax's estimate was off in its recommendations by $54.

[Jak29672]

So I went back and looked at 2018 again.  I did pay estimated tax payments that added up to 100% of what I paid in taxes last year.  Therefore why is the program calculating a penalty  in 2019?

How do I remove it from the forms?

Thanks.

[DavidD66 · Accepted solution]

Did you make your estimated tax payments by the quarterly due dates?

To eliminate the penalty in your tax return, you can delete Form 2210.

Here's the general procedure for deleting unwanted forms, schedules, and worksheets in TurboTax Online:

1. Open your return in TurboTax. (To do this, sign in to TurboTax, and select the Take me to my return button.)
2. In the left side bar, select Tax Tools> Tools.
3. In the pop-up window Tool Center, choose Delete a form.
4. Select Delete next to the form/schedule/worksheet and follow the onscreen instructions.

Or, if using TurboTax Desktop:

1. Enter Forms mode by clicking "Forms" in the upper right section of the screen.  
2. Find form 2210 in the list on the left side.  
3. From the Forms drop-down menu on the top left, select Delete form 2210.

[Jak29672]

Thank you for the good answers. 

[dugyala_home]

Hello,

Question on Tax penalty for 2019 using Turbotax.

I have tax due for 2019. Since tax deadline increased to July 15, 2019, I didn't file before regular filing date April 15, 2019.

Turbotax calculating tax penalty from April 15 to July 15, 2019.  So Turbotax not taking into this new July 15th deadline?

Will you please clarify?

Thank you

[tcoon10428]

why would turbo tax not use the safe harbor rule ? The program just threw the underpayment fine in with my taxes owed and i never knew it until now , 2021 . This happened on my 2019 taxes last year . I want my money back that i never should of paid . How ?

[JeffreyR77]

If you qualify under the safe harbor rule, you can amend your 2019 tax return to claim a refund for the underpayment penalty.  To qualify you must have paid in either 90% of the tax owed this year or 100% of the tax liability of the prior year.  

To amend your tax return using TurboTax, login to TurboTax and click on Intuit Account at the bottom of the dark border on the left.  Select your 2019 tax return and click on the link to amend your return.  You then want to navigate to Other Tax Situations, Additional Tax Payments, Underpayment penalties to enter you prior year information to qualify for the safe harbor rule.