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Hey folk, I’ve looked at several tools that can be used to estimate 2025 taxes (Nerd Wallet, AARP, Dinkytown) and none seem to show the additional senior $6,000 deduction. Are you aware of one that is up to date?
Thanks! Speaking of underpayment - what’s the verdict if you pay quarterly some amount but then take an IRA withdrawal in December and up your estimated in December & March accordingly? I’ll research.
Research shows - General rule: You can avoid an underpayment penalty for 2025 if you pay at least 100% of your 2024 tax liability. For most people, this means continuing to make estimated payments based on the lower 2024 income. High-income earners: If your 2024 adjusted gross income (AGI) was over $150,000 ($75,000 if married filing separately), the safe harbor requires you to pay 110% of your 2024 tax liability.
Hey folk, I’ve looked at several tools that can be used to estimate 2025 taxes (Nerd Wallet, AARP, Dinkytown) and none seem to show the additional senior $6,000 deduction. Are you aware of one that is up to date?
As of a week or two, the main Dinkytown site has been updated for the $6000 Senior Deductiion. I didn't check to see if other sites that the Dinkytown calculator has been updated.
Speaking of underpayment - what’s the verdict if you pay quarterly some amount but then take an IRA withdrawal in December and up your estimated in December & March accordingly? I’ll research.
Research shows - General rule: You can avoid an underpayment penalty for 2025 if you pay at least 100% of your 2024 tax liability.
4th quater estimate is due Jan 15th of the following year. You can skip this estimate altogether if if you file your taxes (including payment) by Feb 1 (Feb 2, 2026 for this year's taxes).
In the case of uneven income, you can pay estimates in each quarter according to the amount of income in the quarter. So if you take a large IRA distribution in December, you're allowed to make your routine 1Q-3Q estimates and only increase your 4Q estimate. That will entail filing a Schedule AI (annualized income) as part of your Form 2210.
IMHO it's one of the more painful forms as you need to determine how much income you received each quarter. Your 1099s and W2s aren't going to help with this; you need to keep track of paychecks (including when bonuses were paid), interest (including short term CDs and T-bills that pay out all their interest at maturity), divs that vary monthly, etc. You don't just divide by 4.
The 100% (or 110%) safe harbor requires you to pay the same estimate each quarter, or front load (pay more than required up front and then less later in the year).
As of a week or two, the main Dinkytown site has been updated for the $6000 Senior Deductiion. I didn't check to see if other sites that the Dinkytown calculator has been updated.
I see it now, it’s called “Enhanced deduction for seniors” and separate from the standard deduction. Thx!
FYI - Single or Head of Household: The deduction is reduced for a MAGI over $75,000 and phases out completely at $175,000. Married Filing Jointly: The deduction is reduced for a MAGI over $150,000 and phases out completely at $250,000.
Comments
Don't want penalties for underpayment of estimated taxes!
https://mutualfundobserver.com/discuss/discussion/64706/e-file-s-2025-tax-calculator-vanguard-s-roth-conversion-calculator/p1
Speaking of underpayment - what’s the verdict if you pay quarterly some amount but then take an IRA withdrawal in December and up your estimated in December & March accordingly? I’ll research.
Research shows - General rule: You can avoid an underpayment penalty for 2025 if you pay at least 100% of your 2024 tax liability. For most people, this means continuing to make estimated payments based on the lower 2024 income.
High-income earners: If your 2024 adjusted gross income (AGI) was over $150,000 ($75,000 if married filing separately), the safe harbor requires you to pay 110% of your 2024 tax liability.
In the case of uneven income, you can pay estimates in each quarter according to the amount of income in the quarter. So if you take a large IRA distribution in December, you're allowed to make your routine 1Q-3Q estimates and only increase your 4Q estimate. That will entail filing a Schedule AI (annualized income) as part of your Form 2210.
https://www.irs.gov/pub/irs-pdf/f1040es.pdf
IMHO it's one of the more painful forms as you need to determine how much income you received each quarter. Your 1099s and W2s aren't going to help with this; you need to keep track of paychecks (including when bonuses were paid), interest (including short term CDs and T-bills that pay out all their interest at maturity), divs that vary monthly, etc. You don't just divide by 4.
The 100% (or 110%) safe harbor requires you to pay the same estimate each quarter, or front load (pay more than required up front and then less later in the year).
FYI - Single or Head of Household: The deduction is reduced for a MAGI over $75,000 and phases out completely at $175,000.
Married Filing Jointly: The deduction is reduced for a MAGI over $150,000 and phases out completely at $250,000.
taxfoundation.org/data/all/federal/2026-tax-brackets/