I received $50,000 long term capital gain after I sold stock. I paid no federal tax last year. Do I need to deposit tax in 2016 to avoid paying a penalty in April 2017?

[wipster]

The stock was sold in April of 2016.  My only income is Social Security.  No tax was withheld from the sale.

[SweetieJean]

Are you married?  Does your spouse have income?

[wipster]

I am single, only source of income is SS, other than the stock sold.

[SweetieJean]

Try this tool:
<a rel="nofollow" target="_blank" href="https://turbotax.intuit.com/tax-tools/calculators/taxcaster/">https://turbotax.intuit.com/tax-tools/...>

[TomYoung · Accepted solution]

If your 2015 income tax liability last year was really $0, you were a U.S. citizen or resident for that entire year and your last year tax covered a 12-month period then you do not need to make estimated tax payments.  You can wait and send in your 2016 income tax with your 2016 income tax return.  You are in one the "safe harbors" for avoiding an underpayment penalty.

Tom Young

[Hal_Al]

When your only income is Social Security (SS), your SS is not taxable and you do not even have to file a tax return.

For 2016, SS is no longer your only income. . Social security only becomes  taxable when added to sufficient other income. For 2016, you do have "sufficient income". Since you are  required to file a tax return, you do need to enter your SS in Turbotax (TT). TT will determine the taxable portion, most likely 85% of it.

[wipster]

Thanks Tom and Hal, I will sleep easier tonight!  I had suspected this due to a previous question and answer(s) but you have confirmed it.  Again, thanks for the quick responses!