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Level 2
May 2, 2024

underpayment penalty refund

  • May 2, 2024
  • 2 replies
  • 21 views

I've had three 1040 clients this week tell me that they got a refund check for the underpayment penalty that was calculated on their 2023 return in ProConnect Tax.  The underpayment penalty calculations for all three of these clients appear to be correct to me (i.e. there's no reason they would be exempt from the penealty).  Is anyone else experiencing this?  Am I missing something?  Is there a glitch in the 2210 calculations in ProConnect?  

    2 replies

    Level 6
    May 2, 2024

    Are they in CA?

    Level 2
    May 2, 2024

    Thanks for asking.  No, no CA or other disaster area relief would apply as they are all in the Chicago area.

    BobKamman
    Level 15
    May 2, 2024

    Thumbs up for "unintentionally funny."

    Level 3
    May 6, 2024

    Some of my clients are also getting a refund of their penalty in the Chicagoland area.

    BobKamman
    Level 15
    May 7, 2024

    Apparently storms and floods in Cook County and surrounding counties in mid-September were enough to trigger a disaster declaration, and IRS extended the January 15 payment date to February 15.  Are these notices clear enough to show that a month's grace period has been allowed?

    https://www.irs.gov/newsroom/irs-announces-tax-relief-for-taxpayers-impacted-by-severe-storms-and-flooding-in-parts-of-illinois 

    Level 3
    May 7, 2024

    The entire penalty has been refunded including short payments for all quarters, not just the last quarter.  The disaster area proclamation for cook county is the only thing making sense, but all of it is being refunded.