My husband and I are retired. In 2018 he took an RMD from his IRA for the first time. Our intention was to withhold enough federal and California state taxes to cover all of our tax liability for the year. However, we came up short due to higher than anticipated capital gain income paid in December 2018.
Because we owe over $1,000 in federal taxes, Turbo Tax calculated quarterly estimated tax payments for 2019. Rather than paying estimated tax payments in 2019 we’d prefer to again withhold a one-time lump sum for both federal and state from his RMD for 2019. We also want to avoid underpayment penalties. If we withhold at least 100% of our 2018 tax liability when he takes his RMD can we eliminate the need to pay quarterly estimated taxes AND will underpayment penalties be avoided when we prepare our 2019 tax returns?
Yes, as long as the "total tax" amount from 2018 is covered by the withholding and your other withholdings, there will be no underpayment penalty. Estimated tax payments will not be necessary and you can disregard.
where on my 2019 CA tax return can I find the tax liability amount?
I am not dealing with 2018. the question is for 2019 and 2020