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Let's say my 2016 Tax was $5000.

Due to a capital gains event my 2017 tax is likely to be $20k.

If my withholding for 2017 is greater than $5000 then estimated taxes are not required or at least I won't be penalized for not making them?

Correct, assuming that your AGI for 2016 was not more than $150,000. With a tax of $5,000, that's probably not likely, but just in case.....

If your AGI for 2016 was more than $150k, then your withholdings would have to be at least 110% of your 2016 tax, or $5500, in order to avoid penalties.

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