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Financial Planning / Tax Strategies


Subject:  underwithhold penalty Date:  2/5/2007  2:21 PM
Author:  Mosquito7778 Number:  91731 of 131235

In working through DW and my taxes I realized we owe about $1600 for 06. Our total withheld was less than 90% of what is owed. Due to some forgotten changes to one of the W-4s early in the year we ended up with less withheld than we owed last year. So based on my reading of Pub 505 and form 2210 it looks like we dont make any of th esafe harbour provisions.
I started to work through 2210 just to get an idea of what type of penalty we would be facing come April, but it got to complicated for me. What I am trying to get is just a rough, worst-case amount.
So, taking the $600 over the entire year at 8% simple interest I get a penalty of $48. Does that make sense as a worst-case penalty amount?

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