[mikl_plkcc]

My preference is that, a double if penalty if any of the following criteria is met.

• We have found a fit. (e.g. 1♥ - (/) - 2♥ - (2♠) - X)
  
• We have preempted. (e.g. 2♥ - (2♠) - X)
  
• The auction is at the 5-level or above.
  
• We have already made a penalty double (redouble or pass). (e.g. (1♣) - X - (/) - / - (1♦) - X is a penalty double of ♦, showing length and strength in ♦)
  
• The opponents have shown 0 suits. (e.g. (1NT) - X)
  
• The double is a direct double, and is not made at the first available opportunity against the same suit(s). (e.g. (1♠) - / - (2♠) - / - (3♠) - X, but not (1♠) - / - (2♣) - / - (2♠) - X as it is the first opportunity to show the remaining two suits)
  
• The bid doubled is forcing and does not show the named suit (in such case, it is a lead directing double, e.g. (1NT) - / - (2♦*) (transfer) - X; however, if the bid has multiple meanings and one of the meanings shows the named suit, this rule doesn't apply, such as bidding 2♣ over a 1-level opening showing clubs or balanced). The forcing rule means that a double of a weak-only multi is takeout in diamonds, because it may well be the last opportunity to double for takeout in ♦ before the responder passes with ♦ length.

In the past, I also played a rule that, if any of us (or my partner only) has bid a natural NT, a double is for penalty, but I have found that it is too limiting as modern NT bids no longer guarantee stoppers in all suits, and it is useful to takeout double with 4432 when they bid my doubleton.