Yes. Withholding is always timely. Period. This concept is not new and is discussed and validated in hundreds of threads.So the real question is, "Can tax withholding on IRA distributions in December cover the income tax on all sources of income, regardless of what day of the year the individual received that income?Yeah. I realize that part was not your real question, but thought you or others might decide to follow that pathway....without realizing there was a stumbling block in the way.
Example:
John receives non-W2 income (like for 1099 contract work) in January. The tax on this income will be approximately $10,000. He does not send an estimated tax payment to the IRS. In December, he takes an IRA distribution and elects to withhold enough to cover the taxes on the IRA distribution plus the $10,000 he owes on the extra January income.
Cheers
Statistics: Posted by Silk McCue — Fri Jan 17, 2025 3:08 pm