The strategy is perfectly lawful. Honestly if you could pay exactly what you owe and get a $0 refund then that is ideal, but near impossible to pull off perfectly. I am trying to convey that it is better to owe a little than it is to get a refund because you could be using that money throughout the year. According to the IRS:

>To avoid a penalty, pay your correct estimated taxes on time... You may avoid the Underpayment of Estimated Tax by Individuals Penalty if:
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>Your filed tax return shows you owe less than $1,000 or
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>You paid at least 90% of the tax shown on the return for the taxable year or 100% of the tax shown on the return for the prior year, whichever amount is less.