Questions tagged [penalty]
The penalty tag has no usage guidance.
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How is the Underpayment of Estimated Tax penalty determined?
My understanding is that if you pay at least 90% of your current tax year obligations, pre-deductions, or 100%† of your obligations in the previous tax year, you avoid the penalty.
I was just sent a ...
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IRA withdraw penalties vs interest rates today
Here's a interesting point of view/question. With interest rates near 10% for loans these days - used car loans at 9.06% for someone with excellent credit - are we at a point where it makes more sense ...
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Question about the specifics of the safe harbor rules for underpayment penalties
For the safe harbor rule for underpayment penalties, you don't have to pay a penalty if:
You expect your withholding and tax credits to be less than the smaller of:
a. 90% of the tax to be shown on ...
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Need help understanding Estimated Tax payments and safe harbor rules
I have not worked for the first half of this year and have some modest dividend/interest income that would end up being less than $1000 in taxes by the end of the year, so I have not been paying any ...
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Consequences of frequent share holder loan and repayment to and from my Ontario Corporation?
Let's say I have an Ontario Corporation in Canada. My corporate fiscal year is from July 1 to June 30. I also have a personal line of credit with my personal bank and I owe $50k to the bank. The ...
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Can a single file tax as "married file jointly" to take advantage of more standard deductions?
Can a single file tax as "married file jointly" to take advantage of double the standard deductions? Why or why not?
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I withdrew contributions from a Roth IRA. Why is my tax service imposing a 10% penalty? I am only withdrawing contributions, not earned income
I received a Form 1099-R from my brokerage with box 7 (Distribution code) marked with Code J indicating that I will be paying a 10% penalty for withdrawing the money. From my understanding, I'm able ...
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Is there a grace period for getting money back out of your 401k plan?
Is there a "grace period" on getting that money back out? For example, if I put $3000 in in April, and I need that $3000 in May, can get it out before the end of the year, can I just pay the ...
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Why does First Time Abate penalty relief not apply to certain tax penalties? [closed]
(If this is not the appropriate SE for this question, I apologize and would be happy to be directed elsewhere. Thank you.)
I recently found out that I didn't declare a distribution from an inherited ...
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Should everyone who receives dividend income fill out a W-4 form reporting it to their employer?
My friend mentioned to me that he got dinged by the IRS for underpayment of estimated tax. Apparently the reason that his employer didn't withhold enough tax from his paycheck is that he received ...
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Understanding underpayment penalty: implications and how to avoid it in the future
Here is a small explanation of my situation which I hope will help to understand my question:
I am a full time employee who lives in California. Each year I get a W2 from my employee and 1099 from my ...
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Is Form 2210 broken for people with children, or am I missing something?
I'm trying to file my taxes right now, and H&R Block's tax software is simultaneously telling me I'm owed a four figure refund and owe a (modest) underpayment penalty. On digging through this year'...
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Post-hoc hardship to avoid early withdrawal penalty (US)
My wife and I took money out of our retirement accounts to pay for emergency repairs to our home in May of 2021. Unfortunately, we were not ordered to relocate or demolish, so it doesn't meet criteria ...
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IRS 10% penalty on gains from an annuity
I consider myself a reasonably proficient investor but annuities are new to me.
For my short-term cash needs, I've been CD laddering.
As I look to invest for 2026 maturity (5 year), CDs are returning ...
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How to respond to CA 2020 tax penalty notice? I forgot to indicate I had health coverage
I received this mail yesterday:
PICTURE OF MAIL
I am a student with F1 visa status and filed both federal and state taxes for 2019 and 2020. I do have an external scholarship that includes a very good ...
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What is the penalty, if any, for mistakenly paying US federal taxes as US tax resident instead of a non-US tax resident?
Determining the US tax residency can be slightly tricky and as a result I wonder what the penalty is, if any, for mistakenly paying US federal taxes as US tax resident instead of a non-US tax resident....
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Are there any penalties or tax consequences if an person decides to take money out of a Roth IRA account prematurely?
Say a person has a Roth IRA account. Now the money in the Roth IRA account is already post-tax contributions. However, say the person has made a significant capital gains on their Roth IRA investments....
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How do I solve an accidental violation of Medicare's 6-Month look-back HSA contribution prohibition?
I'm 67 and worked past 65, not enrolling in SS, Medicare A or B. Therefore, I contributed to my corporate HSA through October 2020. I stopped contributing immediately when, upon my research, I heard ...
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Which Tax Year for Return of Excess Roth Contributions?
In January of 2020, I fully funded my and my wife's Roth ($6,000 and $7000 respectively). Little did I know back then, that I'd get a sizable bonus at the end of the year, which put me over the ...
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Can I close my money in HSA and transfer it to another bank account and use it for non-medical purpose?
In the US, I have funds in my HSA account. If I were to close the account, transfer the funds into another bank account and move out of the US. Can I use the funds from this new account for non-...
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Interest for section 234B and 234C added while filing ITR
I'm working as a software engineer in an IT company.
I'm filing ITR form-1 for FY 2019-20.
My company had deducted and submitted TDS of around Rs 7000 on 6/01/2020 to IT department.
Initially, while ...
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Annual Bonus causing penalty under section 234C in India
My company pays bonuses in March because of which my taxable income also increases quite a lot.
Because of this, I am being charged penalty fee under section 234C due to shortfall of meeting -
15% ...
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Is selling the contribution in Roth IRA to be avoided if at all possible?
I just heard of the rule stating that the contribution into Roth IRA can be sold at any time, any age, without a 10% penalty or any tax liability?
It sounds like an advantage, but it sounds like ...
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Can I avoid the penalty if I rollover a SEP IRA to a Roth and then pull out the money?
I have some SEP-IRA money that I am considering rolling over to a Roth IRA. Since Roth contributions can be pulled out without penalty, is it possible to roll over a SEP-IRA to a Roth IRA then ...
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Whats the penalty for withdrawing from my Roth IRA when I day trade with it? [duplicate]
I have 12K in my Roth IRA. I use it to day trade. Now I want to take out the 12K what is my penalty? And do I get taxed on my trades when I buy and sell?
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What are the penalties for closing a 529 plan account?
At the end of 2019 I opened and funded a 529 plan account. Now in 2020, not having yet filed my federal or state tax return for 2019, I find that this was a poor decision.
The account has earned a ...
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Pay taxes to the IRS, before filing, to avoid penalties?
I live in US and in the last two years I had a tax consultant recommend that I pay a certain amount to IRS online each January so I won't get a penalty. This year I don't have a consultant. I earned ...
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How to claim Commuter Parking funds?
I have funds locked into a Commuter Parking account (withdrawn from my bi-weekly pay on a pre-tax basis) that I will never use. Typically, these funds can only be used on work-related parking expenses....
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Does it make sense to start saving into a 401k, if you might move out of the US before retirement?
Contributions to 401k funds are subject to a 10% penalty if taken out before the age of 59.5. Presuming my employer has a 401k matching program, does it make sense to contribute to a 401k if I might ...
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Penalty or Fee for Filing a Return, When a Refund Is Due
Working on my 2016 Federal tax return, and I've reached the Estimated Tax Penalty line on Form 1040.
I'll get a refund, so my guess is that I won't owe tax penalties on taxes I owe, since I don't ...
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Are non-qualified withdrawals from a 529 plan penalized on the original contributions?
My understanding is that early (nonqualified) withdrawals from a 529 plan are penalized at 10%, plus taxed over any capital gains.
Does the 10% penalty apply to capital/investment gains only, or to ...
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401(k) distribution tax calculation
Wanting to receive $25k distribution from my fully vested 401k w/former employer. Figuring required 20% withdrawal penalty to be $5k (25,000 x20%), so my account balance would be reduced by a total ...
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IRS - Tax return of 2017 - Penalty
My family and I moved to the US, with a job, on May 21 of 2017. Since June of 2017, we have been covered by health assurance through my job. (the form 1095-B from Aetna informs 7 months of coverage). ...
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HSA and Medicare: what if I get laid off?
I'm approaching 65; will continue working for a large company; will not be taking Social Security; have a high deductible insurance plan through my company which I will continue using (so will not ...
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Is there a tax penalty for rollover from Thrift Savings Plan(TSP) to 457(b)?
I have non-roth funds in the TSP and have separated from the military. I'd like to move this to a public employee sponsered 457(b) so I can begin contributing again. Are there any IRS tax penalties (...
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Are automobile loan pre-payment penalties legal in Arizona?
I've not been able to find the answer to this question. I am looking specifically for the law as it applies only to the state of Arizona.
If I take a loan for a car purchase, can I be penalized for ...
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For IRS underpayment penalty, what counts as "refundable credit" in 2018?
The IRS states that in event of gross (>$1000) tax underpayment, penalties are avoided if current years withholdings and refundable credit is more than last years total taxes.
Nowhere in their ...
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Preventing tax underpayment penalty
I had some short term capital gains in 2017 which resulted in underpayment penalties both in my Federal and State taxes. I have about $5K in crypto-related short term capital gains for 2018 to report ...
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Implications of withdrawing Roth IRA contributions before age 59?
What repercussions, penalties, fees, or additional taxes exist on withdrawing contributions (basis) from a Roth IRA account under 59 years old?
For example, suppose I have contributed $5,500 for 5 ...
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Missing S Corp Tax Return - Who Is Liable for Penalty (Company vs Shareholders)?
I have a company that was incorporated in November 2015 as a S Corp. There was no activity at the company for November / December 2015 and a tax return was not filed for 2015.
I found that even with ...
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Bought stock at higher price than current price
I wanted to buy stock ABCD at a price of 880. The current price was 900. When I bought, I set 980 instead of 880 and it was fully executed. I don't understand how it is possible to buy stock at a ...
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How do I pay my ineligible IRA contribution taxes?
This is a follow-up question to I may have made an ineligible contribution to a Roth IRA. What should I do?
In 2017, prior to Tax Day, I made a TY 2016 contribution to my IRA that exceeded my 2016 ...
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Is it legally binding in the UK to declare penalty charge notice issued by the council to the insurer?
Does the Penalty Charge Notice (PCN) for a traffic contravention issued by a local council need to be declared to the insurer? Also, does this affect the premium?
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Using 72(t) to avoid 10% penalty, how much can I withdraw from 401k per year? What are the main disadvantages for doing this?
Imagine this scenario, I'm 40 years old, unemployed, and have 1M in my 401k. If I want to use 72(t) to withdraw money from my 401k, to avoid 10% penalty.
What is the maximum amount that I can ...
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I may have made an ineligible contribution to a Roth IRA. What should I do?
Early this year (before mid-April) I received in excess of $11,000 in taxable inheritance income. The income was distributed from several annuities. I deposited $5,500 into a Roth IRA for the 2016 tax ...
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Can one roll over an after-tax 401(k) to a Roth IRA, then any time in the future withdraw my contributions tax-free and penalty-free?
Can one roll over an after-tax 401(k) to a Roth IRA, then any time in the future withdraw one's contributions (that were initially made to the after-tax 401(k)) tax-free and penalty-free?
Background ...
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Can you be penalized for setting an arbitrarily high number of allowances on your W-4?
I withheld too much in taxes this year. I will benefit a good amount from the Lifetime Learning Credit, which I hadn't heard about until today. Even if I don't pay a cent in taxes for the rest of the ...
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Can your kids take over your 529 plan and use it for their own kids?
Consider the following situation:
There is money remaining in your 529 plan after your children have finished college. Your children now have children of their own.
Can you change the beneficiary of ...
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Taxes on Roth IRA earnings withdrawals <59.5 but >5 years
Homebuyers, education, disability, etc. exceptions aside, if you are less than 59.5 years old but make a withdrawal of earnings from a Roth IRA account that's been open for more than 5 years, do you ...
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529 plan withdrawal penalties
My son is a freshman this year. We live in and he attends school in California. We pulled out the first $ from our Utah 529 plan. I had the money deposited in my account since I paid the ...
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