First time taking RMD

[motalk55]

Do I have to pay the taxes when I receive the disbursement?

[xmasbaby0]

You can/should have tax withheld from the distribution at the time you request it.   In late January to late February you will get a 1099R that you enter onto your tax return.  The 1099R will show how much you took out of the retirement account and how much tax was withheld.   The tax software will calculate all of your income and all of the tax withheld from the various sources of income to determine if you owe more or get a refund.

To enter your retirement income, Go to  Federal> Wages and Income>Retirement Plans and Social Security>IRA  401 k) Pension Plan Withdrawals to enter your 1099R.

I PAID TAX ON THE RETIREMENT MONEY ALREADY

You had tax withheld from the distributions from the retirement account, just like when an employer withheld tax from your paychecks.  When you enter it all into the software, the calculations are done to reconcile the amount of income you received and the amount of tax that was withheld.  You might owe more or you might get a refund.

[motalk55]

Thank you.  Also, would like to know what percentage of tax should be withheld.  I live in California.

[SwapnaM]

You need to estimate your overall tax picture, including your RMD, Social Security, and any other income, and then use your RMD withholding to fill the gap.

IRA providers typically withhold 10% of your RMD for federal income taxes by default. This is optional, and you can adjust it up or down based on your needs. You can file Form W-4P with your IRA provider to change the withholding amount.

California taxes RMD withdrawals as ordinary income. Your RMD will be added to your other taxable income for the year. California's income tax brackets range from 1% to 13.3%, so the appropriate tax rate depends on your overall income. 

@motalk55 Hope this helps!!