Where to add/remove withholding in next year's estimated payments calculation?

[Solar Eclipse]

How does someone add or remove projected retirement distribution withholdings  from next year's estimated payments calculation?  (Turbotax seems to assume the next year withholding amount will be same as the current year)

I found in the "Est Tax Options" worksheet where a projected withholding amount could be added/removed. Is it safe to do so there, or is there another method inside the interview that should/could instead be used?

SE

(TT Deluxe Windows Desktop)

[MaryK4]

You can adjust the default amounts TurboTax uses (it projects using 100% of this year's tax due so you do not incur the Penalty for Underpayment of Estimated Taxes) if you want a more accurate amount.  Follow the following steps:

1. In the Federal Taxes section, click on Other Tax Situations.
2. Under the Other Tax Forms section and select Start/Update next to Form W-4 and Estimated Taxes.
3. Answer "No" to changing your W-4 for this year, then continue through the questions to reach the section that asks about your 2025/2026 Estimated Tax Payments.
4. Proceed through the income/deduction projection screens.
5. When prompted about projected income for next year, you can enter your new, expected withholding amount (e.g., from a retirement distribution) here, adjusting it for the 4 quarters.
    

Alternatively, use the "Annualize Your Income" option within this interview to more accurately project withholding based on when you plan to take the distribution. 

[Solar Eclipse]

@MaryK4   I tried what you suggested and it was a train wreck. Screen after screen of nothing applicable only to end up with the same undesired projection because TT continues to include the withholding of a retirement distribution as part of next year's projected estimated payments.   All I'm looking to do is to toggle on/off (add/remove) the withholding amount so TT reflects the actual quarterly estimated payments due next year, without making any assumption there will again be the same withholding amount as the current year (or any withholding at all).

The easiest way to do this seems to simply override the amount on the Est Tax Options worksheet.  Is it ok to take this approach for the purpose of solving the problem as described?

[MaryK4]

Yes, you can override the amounts on the worksheet, I see what you are saying- TurboTax wants to use the 2025 amounts for the withholdings as well as the tax and income.   You may have to do the adjustments after you file the tax return (I am not sure if this override will prevent the efile), but the estimated tax vouchers TurboTax are NOT reported to the IRS so doing it this way will have the correct information if you transfer the tax file next year.  @Solar Eclipse  

[Solar Eclipse]

@MaryK4   Is there any other way you know of to stop the distribution withholding amount from being included on the Est Tax Options worksheet other than an override (so as to avoid any risk of the return being blocked from e-filing....or how do we determine if this is even a risk to e-filing at all)?  

I was unable to find anyplace in the interview process where it asks if you want current year withholding (or some other amount) as part of the projected estimated payments calculation.  Seems logical that question should be in the interview somewhere rather than TT assuming there will be a withholding again in the following year simply because the current year had one - not to mention assuming it will be the exact same amount !

[AmyC]

I recommend you file the return. Save a copy of your return as always. Then, go in all year long and move around numbers as your situation changes. The vouchers do not go to the IRS. They are not filed with your tax return. 

The IRS wants you to make payments online, they are trying to reduce paperwork received and handled along with protecting your information. A stolen check has become dangerous again. 

This section of the program is just to help you determine your payment.

In the desktop, you can also use the What-if worksheet to see several scenarios at a glance. Copy column 1 to another column to start the process and change numbers.

[winterbike2]

Yes it is only for the user to calculate, but if TurboTax is not going to allow the user to change the expected withholding, then why do this at all?  Why pretend to the user that TurboTax is doing something useful when it is just incorrect?