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Thread: Income Tax Question

  1. #1


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    Income Tax Question

    I have to increase my income tax withholding. I'm trying to figure out the best way to do this either by estimated payments or to increase my tax withholding from my pension and 401(k). I know you aren't suppose to make estimated payments that are weighted heavy towards year end. However, I believe tax withholding is treated all the same even though it is weighted heavy towards year end. Can anyone confirm this?

    My plan right now is to increase my tax withholding by about $2,000 a month from my monthly 401(k) and pension payments over the next 4 months. This will pretty much wipe out my monthly payment from these sources of income over the next 4 months, but at least then I won't have to mess with estimated payments. Last year I had over $7,000 refund in federal income tax as I really didn't gamble at all because of covid, and I was on track to get a similar refund this year.

    This year I only played at brick and mortar casinos a couple of times. However, then Michigan legalized online gambling and as of right now I have over a hundred sessions of online blackjack. I can't believe some of the great VIP promotions this online casino is offering folks for places where online gambling is legalized in USA. Think 2% bonus credit on every $100 gambled when the house edge on the game is less than 0.5%.

    Right now if I quit gambling for the year, this will be my best lifetime year ever. Problem is the tax man wants his cut too.

  2. #2


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    [QUOTE=Midwest Player;299328]I have to increase my income tax withholding. I'm trying to figure out the best way to do this either by estimated payments or to increase my tax withholding from my pension and 401(k). I know you aren't suppose to make estimated payments that are weighted heavy towards year end. However, I believe tax withholding is treated all the same even though it is weighted heavy towards year end. Can anyone confirm this?

    My plan right now is to increase my tax withholding by about $2,000 a month from my monthly 401(k) and pension payments over the next 4 months. This will pretty much wipe out my monthly payment from these sources of income over the next 4 months, but at least then I won't have to mess with estimated payments. Last year I had over $7,000 refund in federal income tax as I really didn't gamble at all because of covid, and I was on track to get a similar refund this year.

    You are supposed to pay in taxes evenly each quarter throughout the year. If you can show that your income was not proportional for each quarter, then you might be able to justify payments that are in line with your tax liability for each quarter. On the other hand, taxes that are withheld from payroll or pension payments are treated by the IRS as having been paid throughout the year,even if they are all withheld in December.

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