The CP10A is good news. The IRS determined you underpaid your estimated taxes, but they waived the penalty. This can happen when the underpayment was small, when you met one of the safe harbor exceptions, or when the IRS exercised discretion to waive the penalty for other reasons (such as a natural disaster declaration).
No Action Required
The penalty was waived. Your account reflects no penalty assessment. File this notice with your records and adjust your estimated tax payments going forward to avoid future underpayments.
Going Forward
To avoid estimated tax penalties in the future, make sure your total payments (withholding plus estimated taxes) equal at least 90% of your current year tax or 100% of your prior year tax (110% if AGI exceeds $150,000). Meeting either safe harbor eliminates the penalty regardless of the actual underpayment.
If you need help calculating estimated tax payments, call us at (813) 229-7100.