Dw and I will be converting an amount of cash held in a traditional ira to a roth ira for the first time. We are in the 22% tax bracket so we will have the online broker withhold 22% for federal tax. We're not sure how much to designate for taxes in the state of Ohio. On the roth conversion form it asks to designate an amount for both. We see that the income tax rate for Ohio is 3.8 %. Do we enter 3.8 % into the space provided for state withholding?
Edit: I'm sorry I didn't mean to say that we would have them take the funds out of the cash in the traditional ira for taxes (I removed that statement from above). What we want to do is pay the taxes at the same time that we do the conversion from funds not in the ira but cash on hand. In order to have the online broker withhold the taxes from cash outside of the ira I guess I need to direct them to the cash held in our non retirement investment account which we have with them correct?
Thanks for any replies.
Edit: I'm sorry I didn't mean to say that we would have them take the funds out of the cash in the traditional ira for taxes (I removed that statement from above). What we want to do is pay the taxes at the same time that we do the conversion from funds not in the ira but cash on hand. In order to have the online broker withhold the taxes from cash outside of the ira I guess I need to direct them to the cash held in our non retirement investment account which we have with them correct?
Thanks for any replies.
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