Quarterly Tax Estimated Payments

turbomjstax — Wed, 22 Oct 2025 18:42:03 GMT

Hi. I've just started taking distributions from my IRA (I'm over 59.5) and am normally applying some of the proceeds to tax payments via Vanguard. The timing is not in line with the quarterly estimated tax payment calendars for Federal and State (I live in CA) but I should exceed the 90% threshold for my total tax liability for 2025. Should I be concerned about any penalty associated with this approach? Thanks, Matt

Re: Quarterly Tax Estimated Payments

SwapnaM — Wed, 22 Oct 2025 19:18:39 GMT

If you exceed 90% of your 2025 total tax liability, you are likely safe from penalties, even if your IRA distributions and tax payments don’t align perfectly with the quarterly schedule. This is because the IRS treats tax withholdings as if they were paid evenly throughout the year — regardless of when they were actually withheld. So even if you make a large withholding in December, it counts as if it were paid quarterly.

Like the IRS, the FTB treats tax withholding as being made evenly throughout the year. If you meet the CA Safe Harbor threshold using withholding from your IRA, you should avoid the CA underpayment penalty as well.

I would recommend that before the end of the year (and definitely before the January 15th deadline), confirm with your Vanguard custodian the total dollar amount of tax withheld on all your IRA distributions for 2025. Use the IRS Tax Withholding Estimator to check if you're on track.

@turbomjstax Thanks for the question!!

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Quarterly Tax Estimated Payments

Re: Quarterly Tax Estimated Payments