Tax withholding is the percentage of income tax that you and your client can elect to have withheld from their IRA distribution and sent directly to the IRS.
The amount you/your client withholds, if any, may differ from their ultimate tax liability. If their withholding ends up being too much, they will be due a refund when they file your tax return. If their withholding ends up being too little, they will owe an additional amount to the government when they file your tax return.
Betterment is not a tax advisor, and the information provided here should not be construed as tax advice. It should only be used for informational purposes. Please consult a qualified tax professional to determine the rules that apply to your client’s individual tax situation.