MA tax witheld on RMD

[frankseb]

I took an RMD in Q1 and had MA tax withheld. Rather than treating this as a Q1 payment, Turbo Tax allocated it by quarter over the year, causing an underpayment penalty in Q1.  This is incorrect treatment.  Would they allocate it over 4 quarters if I had pay it in Q4.  Turbo Tax will not allow me to override and allocate all to Q1.

[HelenC12]

You may use the Annualized Income Method to property report your tax payments in the correct quarter. Please see the "Optional" information below.

We'll automatically generate a Form 2210 and you can revisit this section:

1. Sign in to TurboTax and open or continue your return.
2. Search for underpayment of taxes.
3. Select the Jump to link in the search results.
4. The Underpayment Penalties screen will display the penalty amount. Select Continue to review this section and make any needed adjustments.
   • Note: If you see No Underpayment Penalty, you either haven't entered your income and/or estimated tax payments yet, or you aren't subject to an underpayment penalty.

(Optional) Keep going, and when you get to the Annualized Income Method screen, answer Yes if you want to see if we can reduce the penalty.

Related Information:

• Why am I getting an underpayment penalty if I'm getting a refund?
• What are federal estimated taxes?

Source: TurboTax FAQ

[frankseb]

That may work for Federal taxes, but it doesn't work that way for MA state taxes

[AmyC]

Your best method will be to delete the state withholding from the form and force it into the first quarter. Let me give you the steps:

1. Edit the 1099-R containing the MA amount and delete the MA amount.
2. Go to Deductions and Credits tab
3. Scroll down to Estimated Taxes
4. Locate State estimated taxes for 2019
5. Start
6. Select First Quarter drop down box and enter MA
7. Enter the date paid
8. Enter the amount
9. Done

This is a paper trail that you can argue if the state sends a letter. It is the correct taxes paid in a timely manner. It won't match their "estimated payment" but will match their payment from that time frame.