My understanding is that it's not so simple. Normally they expect equal quarterly payments. But if you do that, you'll have an underpayment in the first quarter (since you'd only pay a quarter of the tax liability incurred in that quarter) unless you meet one of the safe harbor rules. For cases of uneven income throughout the year you're expected to fill out form 2210 schedule AI, which is a rather complicated form.Wondering if anyone knows as the internet rife with info but not answers. If I make a $100,000 Roth conversion in January 2025, can I make a lump sum estimated tax in Q1, or must I spread it out evenly through the 4 quarters?
I'm facing a similar problem next year and am planning to split my conversion into 4 installments to avoid this issue. Another method is to have your broker withhold the tax when you make the conversion and "backfill" the tax by making a 60-day rollover to the Roth account after the conversion. There are some recent threads here discussing this.
Statistics: Posted by Eno Deb — Fri Dec 13, 2024 8:38 am — Replies 2 — Views 127