Federal Income tax facts

 

I finally got around to filing my taxes last Friday.  I get a small refund from the state, but have to pay in on Federal.  Sister wondered why she had to pay a penalty and I did not.  I figured it was becasue I  paid  a larger protion of my total tax bill than she had. Below is what Uncle says about federal income tax penalty.

"If you didn't pay enough tax throughout the year, either through withholding or by making estimated tax payments, you may have to pay a penalty for underpayment of estimated tax. Generally, most taxpayers will avoid this penalty if they either owe less than $1,000 in tax after subtracting their withholding and refundable credits, or if they paid withholding and estimated tax of at least 90% of the tax for the current year or 100% of the tax shown on the return for the prior year, whichever is smaller. "

So, there!