Estimated tax payment on Roth conversion

[Ronstar]

I made a Roth conversion late December that should push us to the top of the 12% bracket. I'm wondering how and when to pay the fed tax on the conversion.

I've seen some info say pay the tax on the Roth conversion in the quarter that the conversion was made. In my case, this would be 1/15.
And I've also seen other info say that the tax is paid with the return on April 15th.

So this is question 1 - when to pay the tax?

So if the answer is pay with the quarterly, I have question 2. We made quarterly tax payments - automated through my former CPA. Should I contact my former CPA to change the automated withdrawal amount to add additional tax to cover the Roth conversion? (we have a new CPA and I really don't trust the old CPA to handle a change in the automated quarterly tax payment correctly)

Or is it ok to just send the IRS a check to cover the additional tax in addition to the automated quarterly? Will it screw something up at the IRS if there is an automated payment and a check payed in the same quarter?

 

[YellowSubmarine]

My take...so long as your paid estimated taxes are no less than the previous year, you're okay to pay off the taxes upon filing 2025 return. If you like, my personal option, send the additional payment to the IRS specifying the tax year to be applied and with your SS number. This can be done anytime before April 15.

 

[ncbill]

I pay as soon as I make the conversion (which was on January 2 for 2026)

Though that didn't work this year via Direct Pay...payment marked as 'returned' but never hit the account.

Maybe I have to wait until after January 15 for a 2026 estimated tax payment?

I did notice I can't make an estimated tax payment for 2026 yet on my state's website.

 

[TheWizard]

I set up a new IRS login.gov account to replace EFTPS which is going away soon for some reason.
Then I sent them a 4th quarter estimated payment of $2500 a week ago which should cover most of the tax due on the Roth conversion I did in December.

My conversions are "small" nowadays, so fewer issues...

 

[fosterscik]

I have made Roth conversions every year since I retired and have never timed a tax payment to occur because of a conversion. As someone said above, make sure you've met the safe harbor limit via quarterly tax payments based on the prior tax-year's liability and there is nothing to worry about.
If I owe more in any given current year, I settle up the extra when taxes are due (for me I wait until early April).

 

[RetiredHappy]

I always make the payment the same quarter and never cross the year. I also did a one time pyament through IRS login.gov in Dec 2025 to ensure that there was no underpayment. I have all numbers in a spreadsheet to calculate tax obligations for the year.

 

[engineernerd]

I have to say I find explanations of the quarterly estimated tax payment calculations very confusing when it comes to uneven income. It's unclear to me whether the "safe harbor" rules apply, and if so, exactly HOW to apply them. Unless someone weighs in with good info on this topic, I would recommend paying the rest of your 2025 taxes in your fourth payment that is due the 15th. And attempting to get the automated payment augmented rather than sending a separate amount, but if it's too late then it's too late. My experience with the IRS is, their systems don't talk to each other and the easier you make it for them the better.

 

[TheWizard]

I have to say I find explanations of the quarterly estimated tax payment calculations very confusing when it comes to uneven income. It's unclear to me whether the "safe harbor" rules apply, and if so, exactly HOW to apply them. Unless someone weighs in with good info on this topic, I would recommend paying the rest of your 2025 taxes in your fourth payment that is due the 15th. And attempting to get the automated payment augmented rather than sending a separate amount, but if it's too late then it's too late. My experience with the IRS is, their systems don't talk to each other and the easier you make it for them the better.

There's a bunch of different safe harbors, not all that complicated.
And if you miss by a bit, you could file that form to show uneven quarterly income.
Or just bite the bullet like marko does and pay the small penalty.
*shurg*

 

[audreyh1]

I made a Roth conversion late December that should push us to the top of the 12% bracket. I'm wondering how and when to pay the fed tax on the conversion.

I've seen some info say pay the tax on the Roth conversion in the quarter that the conversion was made. In my case, this would be 1/15.
And I've also seen other info say that the tax is paid with the return on April 15th.

So this is question 1 - when to pay the tax?

So if the answer is pay with the quarterly, I have question 2. We made quarterly tax payments - automated through my former CPA. Should I contact my former CPA to change the automated withdrawal amount to add additional tax to cover the Roth conversion? (we have a new CPA and I really don't trust the old CPA to handle a change in the automated quarterly tax payment correctly)

Or is it ok to just send the IRS a check to cover the additional tax in addition to the automated quarterly? Will it screw something up at the IRS if there is an automated payment and a check payed in the same quarter?

You need to learn about safe harbor rules and estimated tax schedules. Your first estimated tax payment will be due April 15 and no it isn’t paid with the 2025 return but paid separately online for 2026 and make sure it is identified as 2026 estimated taxes. Note that the IRS no longer accepts mailed checks for tax payments. To be safe, pay one 1/4 of your 2025 taxes on April 15 (110% of your 2025 taxes divided by 4 if your 2025 AGI was over $150K) and the same amount each following estimated tax deadline. There are other approaches as well but more complicated to explain.

 

[audreyh1]

I have to say I find explanations of the quarterly estimated tax payment calculations very confusing when it comes to uneven income. It's unclear to me whether the "safe harbor" rules apply, and if so, exactly HOW to apply them. Unless someone weighs in with good info on this topic, I would recommend paying the rest of your 2025 taxes in your fourth payment that is due the 15th. And attempting to get the automated payment augmented rather than sending a separate amount, but if it's too late then it's too late. My experience with the IRS is, their systems don't talk to each other and the easier you make it for them the better.

For uneven income, if using the prior year taxes paid is expected to result in a large current year overpayment of estimated taxes, then you have to use the annualized income method. This is much more complex but will avoid penalty as well as overpayment. You look at the YTD income received through March 31, May 31, August 31 and December 31, annualize it as if you were earning money at the same rate all year, estimate the taxes, and then pay a prorated amount due the 15th on the following month. There are publications that cover this along with tables that support the calculations for each tax quarter. By Jan 15th of the following year you will have paid 90% of what you estimate you owe, and the remainder on April 15 of that year once you file your annual tax return.

 

[RetiredHappy]

I pay taxes based on my spreadsheet that has all income for the year and withholdings YTD.

 

[audreyh1]

I pay taxes based on my spreadsheet that has all income for the year and withholdings YTD.

Without seeing your spreadsheet no one will understand what you are doing.

 

[mountainsoft]

I set up a new IRS login.gov account to replace EFTPS which is going away soon for some reason.

Interesting. I had not heard EFTPS was going away. I've been using EFTPS for years for my business taxes and Roth conversions.

Thankfully, it shouldn't affect me going forward. I don't need to do any more Roth conversions, and the income from my old business is dwindling down to nothing. A few months ago we just increased the withholding on my wife's pension to cover what little taxes I might owe. IRS still gets their tax money, but it makes things easier on our end.

 

[Dtail]

You need to learn about safe harbor rules and estimated tax schedules. Your first estimated tax payment will be due April 15 and no it isn’t paid with the 2025 return but paid separately online for 2026 and make sure it is identified as 2026 estimated taxes. Note that the IRS no longer accepts mailed checks for tax payments. To be safe, pay one 1/4 of your 2025 taxes on April 15 (110% of your 2025 taxes divided by 4 if your 2025 AGI was over $150K) and the same amount each following estimated tax deadline. There are other approaches as well but more complicated to explain.

As an aside, I forgot about the new no check pymt for estimated taxes.
I sent in a check for my mom's trust a week ago for the estimated 4th quarter tax payment.
What do you think will happen with that check?

 

[mountainsoft]

I have to say I find explanations of the quarterly estimated tax payment calculations very confusing when it comes to uneven income.

My income varies wildly from month-to-month, so I always paid my estimated taxes monthly as it was an easier routine for me. It also saved me from having to save up for a bigger tax bill each quarter. I just paid 20% of whatever I earned as tax. That seemed to work out fine at the end of each year.

Of course, all of the tax forms assume quarterly payments, so I just added up each of the three monthly tax payments to come up with a quarterly amount. I've done that for years, never had a problem.

 

[audreyh1]

As an aside, I forgot about the new no check pymt for estimated taxes.
I sent in a check for my mom's trust a week ago for the estimated 4th quarter tax payment.
What do you think will happen with that check?

Yes, this went into effect in October 2025.

Maybe there is some discussion online about what happens to mailed checks?

 

[Dtail]

Yes, this went into effect in October 2025.

Maybe there is some discussion online about what happens to mailed checks?

Interesting that Kiplinger states that one can still pay the estimated taxes by check although the IRS discourages it.

 

[audreyh1]

Interesting that Kiplinger states that one can still pay the estimated taxes by check although the IRS discourages it.

Yes, apparently my info above only pertained to the IRS mailing refund checks.

The word currently is that the IRS won’t phase out accepting checks for tax payments until sometime in 2027.

 

[Jerry1]

It seems very likely that your accountant set you up to do estimated payments that would put you in safe harbor. I'd confirm that with him and assuming you are under safe harbor, I'd make the payment with the tax return by April 15th.

If you don't want to call him, take your estimated payments for 2025 over last year's tax liability and strike a percentage. Typical safe harbor is 100% or 110% of the prior year (2024) depending on your AGI. Do a little math and you'll be easily able to figure out if you're covered under safe harbor. If you're covered under safe harbor, you will not be assessed a penalty for underpayment of taxes no mater how much you took for the conversion.

Here's the kicker. If you don't make another conversion in 2025, safe harbor becomes more difficult, or at least more expensive. Quick example - let's say your 2024 tax was $100 and you're under $150K AGI. Your estimates will be $25/quarter. In 2025 your tax, because of the Roth conversion is now $200. To stay in safe harbor, you'll need to make $50/quarter estimates. However, if you're not going to do another conversion in 2025, that means you'll be paying a lot more in estimates than you'll really need - twice as much in my simple example. Bottom line, safe harbor works best if you have consistent income year to year. If not, you need to be on top of your tax liability and respective tax payments.

 

[audreyh1]

Interesting. I had not heard EFTPS was going away. I've been using EFTPS for years for my business taxes and Roth conversions.

Thankfully, it shouldn't affect me going forward. I don't need to do any more Roth conversions, and the income from my old business is dwindling down to nothing. A few months ago we just increased the withholding on my wife's pension to cover what little taxes I might owe. IRS still gets their tax money, but it makes things easier on our end.

We plan to switch to paying via IRS.gov, and it looks like you can schedule payments there.

 

[EastWest Gal]

I made a Roth conversion in December, and changed my quarterly tax payment for January 15th. I cancelled the previously scheduled payment amount, and set up a new amount. The tax payment for the 4th quarter is January 15th of the next year. It doesn't matter that it is in the next year.

 

[EastWest Gal]

Interesting. I had not heard EFTPS was going away. I've been using EFTPS for years for my business taxes and Roth conversions.

Thankfully, it shouldn't affect me going forward. I don't need to do any more Roth conversions, and the income from my old business is dwindling down to nothing. A few months ago we just increased the withholding on my wife's pension to cover what little taxes I might owe. IRS still gets their tax money, but it makes things easier on our end.

I only heard about it through this forum. It will go away some time in 2026. According to Google AI, the system will be phased out for individuals some time in 2026, but will continue for businesses. Who knows why.

 

[Montecfo]

I don't find annualized income to be all that complicated. Most of my income is earned ratably throughout the year. Only cap gains and Roth conversions typically require special handling.

 

[RetiredHappy]

I don't find annualized income to be all that complicated. Most of my income is earned ratably throughout the year. Only cap gains and Roth conversions typically require special handling.

Exactly. I have a spreadsheet which I mentioned above and someone said unless I share the spreadsheet, no one knows what I am talking about.

Anyone with abit of spreadsheet and Math skill can customize one for themselves.
Type of income, how much is taxable, what was withheld for taxes.
Deductions, standard vs. itermized. For itemized deductions, every bit of medical expenses have to be captured on another table, LTC insurance... and also SALT.
Fed tax brackets...
Qualified dividends and long term capital gains tax.

I know pretty much by end of the year what my tax obligations would be.

 

[Sunset]

I just pay 110% of the previous total tax amount, spread over the 4 payment times. It's the safe harbor for income over $150K

It's easy, simple, and some years we owe more, others we get refund.