Hi My husband retired in January 2023. He gets a small pension from his employer (@$225) each month. They do not take taxes out despite his request. I have compensated for it in my paycheck (I still work). Are we going to incur any problems with the IRS since no taxes are taken out?
Also, my husband has a small 401K, about $12000. Would you suggest we take it out as a lump sum and put it in a high yield savings account that we currently have? I plan to work for 3-4 more years. My husband turns 70 this June so he will have to take RMD's by 72. I will still be working so we will still be in a higher tax bracket whether we take it all or RMD's.
Thank you.
You'll need to sign in or create an account to connect with an expert.
Hi gilder20,
I hope you are having a great day! You will not incur any problems with the IRS for not having withholding from one of your income sources. When file a tax return, the tax liability is calculated and the withholdings , regardless of the source, reduce the tax liability. The important issue is to have enough tax withheld throughout the year, which you have accomplished through additional withholdings on your wages.
Each taxpayer financial situation is unique and we are not able to determine what is the best investment tool for you in regards to leaving the funds in the 401k or an interest savings account.
I hope this information is helpful!
Still have questions?
Make a postAsk questions and learn more about your taxes and finances.
sheehyboston
New Member
mysman1
Returning Member
rickard
Level 1
myownfriend
New Member
Wiz222
Level 2
Did the information on this page answer your question?
You have clicked a link to a site outside of the TurboTax Community. By clicking "Continue", you will leave the Community and be taken to that site instead.