The Motley Fool Discussion Boards
Financial Planning / Tax Strategies
|Subject: Re: Implications/penalties of converting to Roth||Date: 1/3/2013 5:28 PM|
|Author: vkg||Number: 117284 of 119671|
You will need to file form 2210 to handle uneven income and withholding.
For income in the 4th quarter, federal penalty starts from Jan 15th. If your state has income tax, then you need to check your state's requirements.
This may give you an estimate:
Given the last minute changes in the tax laws, I am not certain that any calculator is correct.
The most likely 2012 federal safe habor would be $1,000 less than your tax liability for 2012.
The penalty is essentially daily interest until paid. I don't know the exact interest rates for 2012. They haven't been extremely high. I believe for an individual in the range of 3%.
Delaying federal payment until April would like cost you between 1 and 2% of the underwithheld amount.
|Copyright 1996-2013 trademark and the "Fool" logo is a trademark of The Motley Fool, Inc. Contact Us|