His $60,000 Pension Covers the Bills. At 66, Another $10,000 From His 401(k) Adds $2,332 to the Tax Bill
A 247wallst.com article by Gerelyn Terzo works through a hypothetical 66-year-old retiree considering a $10,000 401(k) withdrawal on top of a $60,000 pension, showing how the senior deduction's phase-out above $75,000 of income pushes the tax cost to $2,332, about a 23% marginal rate. It recommends paying from cash or a taxable account first and, if withdrawing anyway, covering the gap left by the 20% federal withholding with an estimated tax payment.
