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Why am I receiving an underpayment penalty?

Why am I receiving an underpayment penalty? We do not estimate our taxes
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1 Reply
DawnC
Expert Alumni

Why am I receiving an underpayment penalty?

You did not have enough withholding taken out of your paychecks each pay period.   You may want to give your employer an updated W-4 form and have more tax withheld.  

 

The IRS levies underpayment penalties if you don't withhold or pay enough tax on income received during each quarter. Even if you paid your tax bill in full by the April deadline or are getting a refund, you may still get an underpayment penalty.

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