All About the W-4

Forum|Forum|2 months ago
May 13, 2026
1 reply
38 views

My wife and I are retired earning money through stocks and bonds, How do I fill out my W 4 application.

Also earning money through a small pension. My wife and I do not work.

Ask the Experts - W4 - May 2026

vithalanin

Employee Tax Expert

As you and your wife are retired and all your income now is through sale of stocks and pension, you would not be able to file a Form W4. You would instead File Form W-4P.
In Form W-4P, Step 2 is form pension income. Here you should check box 2b or use the worksheet to account for total household income. Step 4 is where you should ask for additional taxes to be withheld for your investment (stock sales) income.
You will need to calculate the taxes on your investment income. Long term stock sales are taxed from 0% to 20% and short term sales are taxed at the regular tax rate.

user17537289625Author

Level 2

Do I need pay quarterly?

Or do I pay the taxes on the stocks when I sell them.

vithalanin

Employee Tax Expert

The optimal use of the Form W-4P is for pension income.
Estimated taxes is the best way to pay taxes on sale of stocks.
Form 1040-ES is used when making paper payments for the estimated taxes. You can also pay the estimated taxes online.
Estimated taxes are due on April 15, June 15, September 15 and January 15. You would calculate your taxes for each quarter and make the payments accordingly. If you plan on making the payments according to the gains, then you will need to ensure that you report this using the Annualized Income Installment Method to reduce the penalties.
While making estimated tax payments online couple of things to watch for are:
1) Primary Taxpayer's name and Social Security number are entered
2) Select reason for payment as estimated taxes for the year you are paying them for.
@user17537289625