State Underpayment Penalty

EmotionalPin
EmotionalPin Member Posts: 1 Newcomer
in State Filing

This was the first year I’ve had to pay an underpayment PENALTY. The program indicated that the penalty was due because I didn’t have enough state taxes withheld during the year.

I’ve since adjusted my withholding with my employer and paid the penalty. I paid this because I didn't want the penalty to increase any further while I tried to figure this out.

The other day, I received a check from the state returning the full $180. I’m not sure if the software is handling this correctly, but that’s been my experience.

Comments

  • MatthewD
    MatthewD FreeTaxUSA Admin, FreeTaxUSA Agent Posts: 963 image
    Hello EmotionalPin,

    Thanks for letting us know. I recommend that you contact Customer Support while signed into your account and share your story. That way a Support Specialist can see why the software calculated the underpayment penalty.

    Keep in mind you are generally given the option to allow the state to calculate the penalty for you since you are not required to pay the penalty at the time you filed.

    What state do you live in? Not many states will charge an underpayment penalty when you pay on time.

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