I need to pay estimated taxes for 2025 but do not want to pay 110% of my 2024 taxes because I would be overpaying what I will likely owe in 2025. So I am basing 2025 income on 2024 income, minus salary (I retired in 2024).
Basing 2025 income on 2024 is subject to potential underpayment of quarterly estimates, since actual amounts will not be known until the end of the year. From reading on this forum I understand that I can "annualize my income" to avoid or reduce underpayment penalties. 2025 income will consist of SS income and income from 1099-INT and 1099-DIV. I have entered this info into a new copy of TT and TT has calculated what our taxes due would be (again, based on 2024, less salary). What input would be needed to annualize this income in the event I underpay? How would I calculate monthly income for 1099-INT and 1099-DIV which are received as lump sum amounts at end of the year? Again, looking for a way to avoid an underpayment penalty in the event that my quarterly estimates do not cover 90% of 2025 taxes.
Thanks
