IRS expands penalty waiver for underpayment of 2018 estimated individual taxes April 2019 Tax News
In an IRS Notice 2019-25, the Internal Revenue Service expanded penalty relief that it previously announced in Notice 2019-11. The expanded waiver applies to taxpayers whose total withholding and estimated tax payments are 80 percent or more of their 2018 taxes, the previous threshold was 85 percent.
In our February Tax News article, What’s new for filing 2018 tax returns, we provided information that it is not necessary for California to provide a similar waiver because the penalty relief is designed to help taxpayers who were unable to properly adjust their withholding and estimated tax payments to reflect changes under the Tax Cuts and Jobs Act (TCJA). For California purposes, the TCJA had no general impact to the amount of state income tax an individual would owe. Thus, it is not necessary for California to provide a similar waiver described in Notice 2019-25.