How can I verify the IRS received my backup withholding after stock sale?

I recently discovered my brokerage account had my last name wrong (missing a hyphen) on their W9 form. I thought I'd fixed this years ago, but apparently not. When I was just getting small dividends every now and then, the backup withholding wasn't a big deal - the amounts were tiny, and I figured I'd either get it back when filing or it would offset what I owed. Well, I just sold a significant portion of my stock holdings and was completely blindsided when I saw 24% less than expected in my cash balance. After checking with my broker, I confirmed this was indeed backup withholding. We're talking about a substantial amount here - way more than my expected tax bill for the year. My questions: 1. How can I confirm on the IRS website that they actually received this backup withholding? I created an online account with the IRS, but I don't see any record of this withholding anywhere. Where exactly should I be looking to verify they have this money? 2. I'll have some other transactions later this year that would normally require quarterly estimated tax payments. Since the IRS already has received much more than needed to cover the long-term capital gains tax from this stock sale, can I skip making those quarterly payments? Can this excess withholding be applied to those future obligations instead of sending more money to the IRS?

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20 comments

Diego Mendoza

•8M

The IRS doesn't typically show real-time information about backup withholding in your online account. This withholding will be reported to you on a 1099 form (likely 1099-B for stock sales) from your brokerage at tax time, and that's how you'll claim it when you file. For immediate verification, you have a few options: First, your brokerage should provide you with transaction details showing the withholding. Second, you could contact the IRS directly at 800-829-1040, though wait times can be extremely long. Third, you could request a wage and income transcript from your IRS online account, but it may not show recent withholding until the brokerage reports it. Regarding your quarterly estimated tax payments - yes, you can absolutely consider the backup withholding when determining your estimated tax obligations. The IRS doesn't care how you satisfy your tax liability as long as enough tax is paid throughout the year. The backup withholding counts toward your total tax payments for the year.

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Chloe Wilson

•8M

Thanks for the information. I was hoping there'd be some way to verify this in real-time, but I understand the IRS systems probably aren't set up for that. The amount withheld was over $12,000, so I'm anxious to confirm they received it. For the quarterly payments - that's good news. If I normally would've owed about $4,000 in quarterly payments later this year, it sounds like I can skip those since the withholding already far exceeds my projected liability. Is there any special form I need to fill out to indicate this, or do I just hold off on making those payments and sort it all out when I file next year?

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Diego Mendoza

•8M

You don't need to do anything special to "assign" the backup withholding to cover your quarterly estimated tax obligations. The IRS looks at the total amount of tax paid throughout the year (including withholding) when determining if you've met your payment requirements. Since your backup withholding significantly exceeds your projected tax liability, you can indeed skip making those quarterly estimated payments. When you file your return next year, you'll report both the income and the backup withholding, and you'll receive a refund for the excess amount that was withheld. Just keep good records of the transaction and withholding amount from your brokerage statements as documentation.

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Anastasia Romanov

•8M

I went through almost the exact same situation last year when I sold some stock from an inherited account. The name discrepancy triggered backup withholding and I lost about 28% to withholding. I spent weeks trying to verify the IRS received it with no luck through their website. I finally discovered taxr.ai (https://taxr.ai) which helped me analyze all my documents and confirmed exactly what happened. Their system pulled the withholding information from my brokerage statements and explained how it would be credited on my tax return. They even showed me exactly where it would appear on my tax forms. Gave me peace of mind that I wasn't going to lose that money.

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Anastasia Romanov

•8M

No, taxr.ai doesn't connect directly to IRS systems - it analyzes your financial documents and tax forms. What made it valuable for me was that it explained exactly how the backup withholding would be handled, where to find the withholding on my 1099 forms, and how it would be reported on my tax return. For your situation with dividend income, it would analyze your brokerage statements and show you precisely where the backup withholding appears and how it will be reported to the IRS. The service gave me confidence because it showed me the exact line items on tax forms where this would all be documented and credited.

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StellarSurfer

•8M

I wanted to update after trying taxr.ai that was mentioned earlier. It actually was really helpful for my backup withholding situation. I uploaded my brokerage statements and it confirmed I had $5,238 in backup withholding that would be reported on Line 4 of my 1099-DIV. The tool explained that while I can't see this in my IRS account yet, the withholding will be fully credited on my tax return when I file (on Line 25d of Form 1040). It also verified I could skip my next estimated tax payment since my withholding already covers my tax liability for the year. Totally worth checking out if you're in a similar situation with backup withholding. Gave me peace of mind knowing exactly how this will all work out at tax time.

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Zara Malik

•8M

I had the exact same issue with backup withholding last year because my brokerage had my old address. After trying for 2 weeks to get through to the IRS and being on hold for hours, I used Claimyr (https://claimyr.com) and it seriously changed everything. I was connected to an actual IRS agent within 45 minutes who verified they had received the backup withholding from my brokerage. The agent confirmed the exact amount and told me it would be credited on my tax return. There's a demo video that explains how it works: https://youtu.be/_kiP6q8DX5c After spending days trying to get through on my own, this was a huge relief. The IRS agent even helped me understand how the withholding would offset my quarterly estimated taxes.

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Zara Malik

•8M

Claimyr uses a callback system that monitors the IRS phone lines and calls you when it's your turn in the queue. You don't have to stay on hold yourself - their system does the waiting for you. They don't have special access to the IRS - they just use technology to navigate the phone system and hold your place in line. When you're about to reach an agent, you get a call letting you know it's time to connect. That's why I was able to reach someone in about 45 minutes instead of waiting on hold for hours or getting disconnected.

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Sean Kelly

•8M

I need to apologize for my skepticism earlier. After another frustrating morning of trying to reach the IRS about my backup withholding issue, I decided to try Claimyr. I honestly didn't expect much, but I was desperate. It actually worked exactly as described. I got a call back in about an hour, and was connected with an IRS agent who verified they had received my backup withholding ($7,845 from stock sales). The agent confirmed this would be applied to my 2023 tax liability and I could reduce my Q4 estimated payment accordingly. For anyone dealing with backup withholding issues and needing confirmation from the IRS - this is definitely worth trying. I wasted days trying to get through on my own.

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Nia Thompson

•8M

Just a tip from someone who deals with this regularly - you can also verify backup withholding by requesting a Tax Account Transcript from the IRS. It sometimes shows payments made on your behalf by third parties, including backup withholding. It's not always immediate, but it's another option if you want documentation directly from the IRS. You can request the transcript through your online account or using Form 4506-T. Look for the "withholding credits" section when you get it.

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Nia Thompson

•8M

The timing can vary quite a bit. Generally, backup withholding doesn't appear on your transcript until the financial institution reports it to the IRS, which often happens quarterly. So it could take anywhere from a few weeks to a few months. For a stock sale that happened three weeks ago, I wouldn't expect to see it on your transcript just yet. It might show up in a month or two, but in some cases, it won't appear until the brokerage submits their year-end reporting. The most reliable confirmation will ultimately come when you receive your 1099 forms from the brokerage in January/February next year.

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Carmen Vega

•5M

I went through a very similar situation a few years ago when my brokerage had an outdated SSN on file (long story involving a name change). The backup withholding hit me on a large mutual fund redemption and I was panicked about whether the IRS actually received the money. Here's what I learned: The IRS systems are notoriously slow to update, so don't expect to see backup withholding reflected in your online account immediately. Your brokerage is required to send the withheld funds to the IRS within a specific timeframe, and they have strong incentives to comply since they face penalties if they don't. For verification, I found the most reliable approach was to keep detailed records of the withholding from your brokerage statements and wait for your 1099 forms. The 1099-B (for stock sales) will show both your proceeds and the backup withholding amount. This is your official documentation that the IRS will accept. Regarding quarterly payments - you're absolutely right that you can adjust them. The IRS cares about your total tax payments for the year, not the timing or method. If your backup withholding exceeds your projected liability, you can reduce or skip estimated payments accordingly. Just make sure to run the numbers carefully to avoid underpayment penalties.

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