Estimated Payments

Forum|Forum|2 years ago
April 1, 2024
2 replies
45 views

I will be taking my first RMD in 2024 at the end of the year. Can I skip making estimated payments and have the total tax I owe for the year taken out of the RMD? Will this be counted as having been withheld evenly throughout the year, and result in no underpayment penalties or interest charged?

TomD8

Alumni - Champ

Q: Can I skip making estimated payments and have the total tax I owe for the year taken out of the RMD?

A: Yes.

Q: Will this be counted as having been withheld evenly throughout the year, and result in no underpayment penalties or interest charged?

A: Yes. Amounts withheld from IRA distributions are considered paid evenly throughout the year, even if made in a lump sum payment at year-end.

**Answers are correct to the best of my ability but do not constitute tax or legal advice.

SteamTrain

Level 15

One thing to note:

Make sure you take it before the end of the ~2nd week in December.

We've seen a couple posts in here for folks waiting until the last few days of December, where the issuer didn't get it processed until January...then it gets pushed as a distribution the next year, and you don't get to use the RMD for the year you wanted...withholding neither. Give them plenty of time to get it actually exercised in 2024.

IF you get a paper check for it, the processing date by the issuer is important, not the date you physically get the check.

____________*Answers are correct to the best of my knowledge when posted, but should not be considered to be legal or official tax advice.*