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Returning Member
posted Aug 18, 2020 1:33:54 PM

Tax on IRA withdrawls

I just retired. How do I know how much to withhold out of my Schwab IRA for federal taxes. I live in Texas , so there is no state income tax . Thanks.

0 5 1200
5 Replies
Level 15
Aug 18, 2020 2:06:40 PM
Level 15
Aug 18, 2020 2:13:46 PM

....or try TTX's Taxcaster tool.  It uses 2019 rates, but should be close enough:

 

https://turbotax.intuit.com/tax-tools/calculators/taxcaster/

Level 15
Aug 19, 2020 5:53:04 PM

In the simplest case, if you are single and withdraw $25,000 or less from the IRA, then your social security is tax-free and you will pay about 6% federal income tax on the IRA.  (No tax on the standard deduction of $12,500, then 10% on the next $9000, then 12% on the last $6000.)

 

However, if you are married, or have other income, or withdraw more than $25,000, then your tax on the IRA goes up and you also start to pay tax on your social security.  So you really need to use one of the online calculators. 

Level 7
Aug 23, 2020 11:03:27 PM

This is an excellent calculator to play around with 

https://www.mortgagecalculator.org/calcs/1040-calculator.php

Edited the link to show the full 1040 calculator instead of 1040ez

Level 2
Sep 15, 2020 9:36:42 AM

Thank you for the mortagecalculator it is great, just what I was looking for.