always_learning
Recycles dryer sheets
- Joined
- Feb 2, 2017
- Messages
- 267
Assume a Roth conversion of $150k in Q1 and other income through the year of $50k, so total income for the year is $200k.
That large Roth conversion in Q1 will require an Est tax payment (based on the formula in Form 2210) that will be more than the total tax burden by about $7,000, depending on deductions/qualified DIV.
I know that a large refund would be in order, but due to the penalty part of the worksheet, if I KNOW I won't exceed a certain amount of taxes through the year, if I pay less than the amount the formula tells me to, even if I still end up with tax overpayment at filing time, I will still owe a penalty?
Do I understand this correctly?
That large Roth conversion in Q1 will require an Est tax payment (based on the formula in Form 2210) that will be more than the total tax burden by about $7,000, depending on deductions/qualified DIV.
I know that a large refund would be in order, but due to the penalty part of the worksheet, if I KNOW I won't exceed a certain amount of taxes through the year, if I pay less than the amount the formula tells me to, even if I still end up with tax overpayment at filing time, I will still owe a penalty?
Do I understand this correctly?