Ira tax due

Forum|Forum|4 years ago
January 26, 2022
1 reply
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I took an IRA distribution in kind (precious metal) with no withholding. May I pay the tax due quarterly?

DanaB27

Level 15

To clarify you took the distribution in 2022 and want to make estimated tax payments for 2022.

Please see the estimated tax payment options available at the IRS Payment website:

IRS Direct Pay from your checking or savings account
Debit or credit card
Pay online or by phone using the Electronic Federal Tax Payment System (EFTPS)
Same-day wire transfer from your bank
Cash payment at a retail partner

If you want to pay your 2021 tax due with an installment plan then please see Can I set up a payment plan for my taxes?

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clifford217Author

Level 2

I am familiar with paying IRS tax online. Let me remind you that the IRS wants the tax due, when we get the funds. If I take my MRD ($60,000, with $15,000 tax due) but no withholding, they want their tax due now. If I make quarterly payments (which I want to due) they are not getting their tax right now (like withholding). Hence, I get penalized? What do you think?

GeorgeM777

Level 11

You are right to imply that the US tax system is a "pay as you go" system. Moreover, as you state, you can pay the tax due (or at least 90% of the total tax liability, if any) when you receive your required minimum distribution. However, paying the tax due in quarterly estimated payments is also an option. In this regard, the IRS has stated the following:

"There are two ways to pay tax:

Withholding from your pay, your pension or certain government payments, such as Social Security.
Making quarterly estimated tax payments during the year." (underline and bolded text not in the original text)

The above quoted stated was obtained from the IRS website. I have included a link to that page below.

Pay As You Go

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