I will be taking a 34,000 lump from my 401k and I need to know how much taxes I will owe?
2007-01-21 10:32:50 · 3 answers · asked by Brett C 4 in Business & Finance ➔ Taxes ➔ United States
Assuming that you are under 59 1/2 and in the 25% bracket, approximately $12,000 will be going to federal taxes and penalties. Also, there are the state taxes if applicable.
2007-01-21 10:50:39 · answer #1 · answered by Wayne Z 7 · 0⤊ 0⤋
If you're under 59-1/2, you'll probably have to pay a penalty of 10% on the withdrawal, which would be $3400.
No matter how old you are, you'll pay regular income taxes on it The penalty, if applicable, is additional to that.
You have the option of rolling some or all of the money into a rollover IRA, and then taxes on the part you roll over would continue to be deferred. There's a time limit on this, so be sure you know what it is when you get the money if you're going to do that.
2007-01-21 19:03:21 · answer #2 · answered by Judy 7 · 0⤊ 0⤋
The best thing to do is to let whoever is handling your 401(K) determine that. Because it depends on your salary and your age.
2007-01-21 18:46:35 · answer #3 · answered by Ray D dog 4 · 0⤊ 1⤋