Federal withholding on annuities


Q.I have heard that friends are having more taken out for federal tax on their IRA or annuity accounts.  Mine did not.  Does that mean I’ll owe money next April?  I thought all the Bush tax cuts were extended.

A. Withholding and the actual tax you wind up owing are two different things. I can’t tell you whether or not you’ll owe money in April, but the more you contribute during the year, the less likely you are to have to pay later.


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Mike Miles is a Certified Financial Planner licensee and principal adviser for Variplan LLC, an independent fiduciary in Vienna, Virginia. Email your financial questions to fedexperts@federaltimes.com and view his blog at money.federaltimes.com.

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