I’m retiring from my W2 job in Q2 2027 and am reading up on estimated taxes to prepare.
Am I correct that because I’ll have W-4 withholding in 2027 up until my retirement date, I’m exempt from needing to hit any of the usual quarterly estimated tax payment targets (25% of the year’s required payment by April 15, 50% by June 15, 75% by Sept 15, and 100% by Jan 15 of the following year)?
I plan to do Roth conversions each year in retirement but wait until Q4 to do them so that I can adjust the size, maybe filling up a tax bracket or keeping my overall effective tax rate under some limit. I believe as long as I pay my full 2027 tax obligation by January 15, 2028 I’ll be within the safe harbor even if I don’t hit the usual quarterly targets in 2027.
Would I need to file form 2210 schedule AI (Annualized Income Installment Method) for 2027?
Years beyond 2027 seem more straightforward. My income will be more consistent year to year and I can pay quarterly using 100% (110% depending on AGI) of the prior year’s tax obligation as my safe harbor payment amount.
