Managing pre-tax income/IRA withdrawals

Williamscnd · ‎April 24, 2024

I will be retiring and starting SSA income June 1, 2024 and choose to have 22% pre-taxed. I will also have IRA income, how can I accurately have my IRA withdrawals taxed in 2024? Or do I manage this when I file my taxes in 2025?

KarenL · ‎April 24, 2024

It's better to have taxes withheld from your IRA income as needed, assuming it's a taxable Traditional IRA. The IRS is a pay-as-you-go type of system. If you don't pay enough in, it's possible you will owe underpayment penalties when it comes time to file. A great place to start is with the Tax Caster tool. Just enter in your details, and you'll get a pretty good idea of how much tax you'll need to have withheld from your income sources. The tool is for 2023 still, but it will be close for you.

Congratulations on your retirement!

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View solution in original post

KarenL · ‎April 24, 2024

It's better to have taxes withheld from your IRA income as needed, assuming it's a taxable Traditional IRA. The IRS is a pay-as-you-go type of system. If you don't pay enough in, it's possible you will owe underpayment penalties when it comes time to file. A great place to start is with the Tax Caster tool. Just enter in your details, and you'll get a pretty good idea of how much tax you'll need to have withheld from your income sources. The tool is for 2023 still, but it will be close for you.

Congratulations on your retirement!

**Say "Thanks" by clicking the thumb icon in a post
**Mark the post that answers your question by clicking on "Mark as Best Answer"

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Managing pre-tax income/IRA withdrawals