Where to enter/change last year's tax amount in TT

[wiyk]

TT is calculating a underpayment penalty. While I did underpay (intentionally), I paid 120% of my 2023 tax amount, which is sufficient to meet the criteria for no penalty.

I didn't use TT last year, so I'm assuming the program thinks I paid $0 in taxes last year. But I can't find where I can enter the previous year's tax due in the program, and no screen that covers the underpayment calculation. There's just the useless underpayment screen that says "you owe $$$" with no other information.

Since the program needs the previous year's tax amount to determine underpayment, I assume you can enter it somewhere, but where?

[PaulB1 · Accepted solution]

Since you are trying to avoid a penalty for what looks to be a withholding underpayment, go to FORMS and see Form 2210. Sounds to me that you need to check YES in question 9 of PART I.  By doing this, you leave the evaluation of penalty up to the IRS and when they see the numbers, they will understand.

All the amounts get filled in by TT.

I had to do this for another reason.

[wiyk]

Thank you. Line 8 of Form 2210 is what I needed, but of course, despite TT using form 2210 for the calculation, it's not listed under Federal Forms in the left column. And there is no mention of Form 2210 on the penalty page.

I guess next year I don't need to buy TurboTax. If I have to go through each form and all the instructions to complete my taxes, why pay $50 for a calculator?

Thanks Paul.

[VolvoGirl]

Are you using the Desktop installed program or the Online browser version?

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 to let the IRS calculate it.

[wiyk]

Thanks. Yes, line 8 of form 2210 was what I needed. Unfortunately, TT Deluxe doesn't bother listing Form 2210 in the list of forms for the tax return, nor is it mentioned on the screen with the penalty listed. You have to already know to look up 2210.

I wonder how many people pay the penalty that don't have to.

For me at least, it makes TT nothing more than an expensive, glorified calculator.