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What is Safe Harbor?

This number represents the amount a taxpayer could pay, via withholding and estimated taxes, to avoid an underpayment penalty.

Safe Harbor tax laws help taxpayers avoid underpayment penalties if they owe less than $1,000, or by paying a certain amount based on the current or prior year's taxes due. 

This value is calculated as either 90% of current-year taxes or 100% (or 110% if AGI is over a certain amount) of prior-year taxes.

Because in any given tax year we're reviewing the prior year's return (2025 tax returns due in April of 2026), the Tax Report will always display the 100%/110% prior-year calculation in the Key Figures. Clicking on the question mark (?) icon located to the right of Safe Harbor will provide additional details on the value:





On the other hand, the Scenario Analysis displays both the 90% of current year calculation and the 100%/110% prior year calculation within the Federal Withholding Calculator tab.