I took the RMD from my inherited IRA account for the 2024 tax year. I was uncertain which withholding percentage I should choose for Federal tax. I opted for the percentage equating to my tax bracket for the 2023 tax year. My 2024 income will place me in a higher tax bracket.
If my withholding from all income sources for 2024 exceeds my 2023 tax liability, am I correct in assuming that I will not be subject to a penalty for having chosen a withholding percentage for the RMD that is less than my 2024 tax bracket?
Thanks in advance for your insights!
If your 2023 AGI was more than $150,000 ($75,000 if married and filed separately), it will need to be at least 110% of your 2023 tax liability to qualify for this safe harbor, otherwise tax withholding of at least 100% of 2023 tax liability is sufficient.
You might also what to check state tax withholding to see if it's sufficient.
If your 2023 AGI was more than $150,000 ($75,000 if married and filed separately), it will need to be at least 110% of your 2023 tax liability to qualify for this safe harbor, otherwise tax withholding of at least 100% of 2023 tax liability is sufficient.
You might also what to check state tax withholding to see if it's sufficient.