We now receive ~$150,000 in qualified stock dividends annually. Only my wife works, and we have had all of our state and federal tax withholding (w/h) taken from her payroll check. Soon she too may want to likewise retire, as the needed w/h from each check (for both her salary and the dividends) makes it seem "pointless to work" - lol! I was wondering if I could instruct the agent for the company paying those dividends to withhold a one time w/h payment for both the fed and state (CT) each December. That w/h would be calculated to be sufficient, such that we would not owe a tax penalty. I am also assuming that there is no "time element" associated with that stock dividend w/h payment; like payroll w/h, it is assumed to be paid over the entire tax year. I would prefer not to file quarterly estimated taxes (nor further increase the w/h from wife's check). Thanks for any advice.
- posted 12 years ago