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Author: awatts One star, 50 posts Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: of 121333  
Subject: Re: Estimated Payments '99 Date: 2/17/1999 2:15 PM
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TMF Taxes

In message 10226 you said
[[ --do I spread those payments out over the year, evenly?]]

Nope...if your gains were made in January 1999, you'll have to make a first quarter payment (assuming that you don't fall under the safe harbor rules) in order to have your tax payments made on a timely basis. You can't spread it out.


The above answer pertained to capital gains. Is the answer the same as pertains to a IRA to Roth conversion made in 1998? Maybe I better back up and give you my thinking with some numbers. Correct me if I am wrong.

My IRA was converted to Roth IRA in Dec 1998, zero basis, total amount converted let's say is $40K; I will elect to spread over four years.

Tax Year 1998 - report $10K and pay tax 15 Apr 1999. (Probably should have done an estimated tax payment on 15 Jan 1999)

Tax Year 1999 - calculate estimated tax on $10K: total amount due is payable in full on 15 Apr 1999, the date when the first quarterly estimated payment is due. One is not permitted to spread the tax due from the IRA converstion over the four quarterly estimated tax payment dates.

Same for next two years. Is this correct?
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