Stupid annuity/tax question

[dock]

I’m taking the distribution on an annuity from my grandfather. On the form it asks what (if any) amount or percentage I want withheld for federal and state taxes. How do I determine what to withhold? And if I overestimate, what happens? I know it’s probably not MM, but I don’t love the idea of owing $$$ at tax time next year.

[Deleted]

Look at the federal tax bracket below for 2020. See which one you fall into. Withhold at your highest rate to ensure you don't owe. Then google "(your state) tax brackets" and do the same thing.

Simple tax break down of a single person:
you pay 12% for income $0-$40,125
you pay 22% on your income $40,126-$85,525

So I fall into the 22% so I know I withhold 22% for my 1099 jobs for federal taxes.

Marginal Rates: For tax year 2020, the top tax rate remains 37% for individual single taxpayers with incomes greater than $518,400 ($622,050 for married couples filing jointly). The other rates are:
35%, for incomes over $207,350 ($414,700 for married couples filing jointly);
32% for incomes over $163,300 ($326,600 for married couples filing jointly);
24% for incomes over $85,525 ($171,050 for married couples filing jointly);
22% for incomes over $40,125 ($80,250 for married couples filing jointly);
12% for incomes over $9,875 ($19,750 for married couples filing jointly).

ETA: if you pay too much then you get a refund. Just like with a W-2 job. 

[dock]

@lemonlover THANK YOU!!