Federal Tax Withholding Calculation

There are a few ways to accomplish this. The calculators can be confusing so I will try to simplify the process for you.

 

When completing your W-4P, I would start with a Single selection, then on Step 2, line b. III enter the total amount of income from all sources including the pension you will receive in 2024.  

• To arrive at the amount of potential taxable income, add the income for the year, subtract your standard deduction, then use the tax tables for an estimated tax for all of 2024.
  • 2024 Inflation adjustments (standard deduction)  
  • i1040tt.pdf  (tax tables for 2023 can be used)

Do not complete Steps 3–4(b) on this form. Instead, you can add additional withholding on line 4(c). There are a couple of ways to decide the amount.

1. If there was a balance due in 2023, take that amount and divide it by the number of pension payments you will receive for the rest of the year and enter that amount.
2. Wait until you see what is withheld on the next pension payment(s) and then submit another W-4P with an amount in additional withholding to increase the amount of total withholding if you think it may not be enough. 

You are allowed to submit as many W-4Ps as you need to and the plan administrator must make the changes you need.

Thank you. I'm trying to "tweak" the estimated taxes that I have to pay quarterly. I know my withholding from social security and my IRA, however, to determine the amount of estimated taxes, the only number I'm missing is the withholding from my pension. Turbotax asks me for withholding from other sources. 

 

Even though estimated taxes are just estimates, I should be able to calculate the withholding for single and married file jointly. It's a. monthly payment. Isn't there a simple calculation where I input the monthly amount and it tells me the withholding for single and married?

 

 

If you were legally married on December 31, 2023,then you do not file single.  You choices are Married Filing Joint or Married Filing Separately.   

I slected it so more money can be withheld. I hope that the IRS doesn't have a problem with that. Do you think I should revise it?

Generally, if you ask your Pension Plan Administrator to withhold 10% of your distribution amount for Federal Tax, you will be fine at tax time.

 

Here a Tax Withholding Estimator from the IRS to help you, as well as more detailed info on Pensions and Annuity Withholding.

 

@mitchden1