Roth Conversion Tax Payment
Someone who is not retired makes a large Roth Conversion early in a calendar year. They choose to raise their W-4 withholding where the taxes owed would be paid from their paycheck over the rest of the year. Would they be subject to any IRS penalty for not making an estimated payment?
Permalink Submitted by Alan - IRA critic on Mon, 2024-04-08 15:37
Not if the withholding is enough to meet one of the safe harbors, which is the lesser of 100% of your prior year tax liability (110% if prior year AGI was over 150,000), 90% of the current year tax liability, or owing less than $1,000.
Permalink Submitted by John Boyle on Mon, 2024-04-08 17:28
Thank you Alan.