Underpayment penalties are assessed if you don't withhold or pay enough tax on income received during each quarter.
Tip: To reduce or possibly even eliminate your underpayment penalty, search for annualizing your tax (use this exact phrase) inside TurboTax. This will take you to the underpayment penalty section and we'll take you through the steps to possibly reduce your underpayment penalty. (If you don’t see Jump to annualizing your tax in the search results make sure you’re in your return and not on the Tax Home page.)
Related Information: