First, check the IRS web site and your credit card's terms and conditions. Each of the three authorized credit card providers charges a fee of around 2%, that may eat up the credit card reward you are expecting. Some credit cards don't allow rewards on cash advances or the purchase of cash equivalents like gift cards, and that may include tax payments. https://www.irs.gov/payments/pay-your-taxes-by-debit-or-credit-card
Second, you must make an estimated payment by January 15, 2025. Then, when preparing your return, you must also include a penalty form 2210 using the annualized income method option. You can access this in Turbotax under special circumstances, you may not be prompted automatically. The IRS assumes that income was earned evenly throughout the year, but payments are made when they are made. If you withdraw for example $40,000, the IRS will assume that $10,000 was withdrawn in each quarter, meaning they expect a tax payment of around $1500-$2500 (depending on your tax bracket) in each quarter. It will look to them like you under-paid your estimates in the first 3 quarters and you will be assessed an underpayment penalty even if you paid in full in the 4th quarter (January 15). By using the annualized income calculation, you show the IRS that some of your income occurred as a lump sum, and that when looked at quarter by quarter, your payments (withholding plus payments) were appropriate for the amount of tax you owed in each quarter.
If you had withholding, you won't have to include the penalty form with your tax return, because the IRS assumes that withheld amounts are also spread out evenly over the year, so the withholding will be considered timely to the income.
Lastly, if you made the withdrawal in the first quarter of the year (January 1-March 31) you could take advantage of the IRS's assumptions about income and payments, by making 4 equal tax payments (April 15, June 15, Sept 15 and Jan 15) even though the entire withdrawal occurred in the first quarter. The tax money could be left invested or in an interest bearing savings account in the mean time.
And, really finally, if the grandfather was past his RMD beginning age, and had NOT withdrawn his own RMD for 2024 before his death, then part of your wife's withdrawal will be considered the grandfather's RMD. You can determine the amount using the life expectancy tables in publication 590-B or asking the custodian of the IRA for help. When Turbotax asks if the withdrawal was an RMD, you would say "part of it" and indicate the amount. This does not affect the taxability of the withdrawal but it does affect what you can do with the money -- for example, the portion that is the RMD can't be rolled over into another IRA. (If the grandfather had already withdrawn money equal to or more than his RMD for the year, you don't have to do this.)
