Daily Tax Report ®

Treasury Cuts Penalties for Taxpayers Confused About Withholding

March 22, 2019, 4:15 PM

The U.S. Treasury Department is again reducing penalties for taxpayers who didn’t pay enough of their tax bill throughout the year.

Taxpayers who paid at least 80 percent of their estimated tax liability for 2018 through paycheck withholding or quarterly estimated payments won’t face Internal Revenue Service penalties this year, a senior Treasury official told reporters March 22. Taxpayers typically pay fines if they don’t cover at least 90 percent of their tax liability during the year.

It is the second time Treasury has reduced the penalty threshold for the first filing season following the passage of the 2017 Republican...

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