If I recieved money from a 401K plan do I need to report it on my tax return?

Question

I had quit an old job and a couple months later I recieved a check in the mail from my 401K. I was wondering if i needed to report that on my taxes, the letter that came with the check said that taxes had been taken out, and someone told me that if it was less than 600 dollars then I wouldn't have to report it. Is that true?

Answer 1

You will get a form 1099R. It should have been mailed to you by January 31. You'll probably be subject to a 10% penalty for it being an early distribution. I am assuming that you are under the age 59 1/2. Had you rolled it over into another retirement plan within 60 days from receiving the distribution, you could have avoided a 10% penalty. You must report the distribution.

Answer 2

Yes, you do have to report it. You'll get a 1099-R that will show the distribution amount and show it as taxable. It will also show the amount withheld.

Not only do you have to show the distribution amounts on your tax returns, you are probably also going to get hit with a 10% extra tax when you complete your return. On the other taxes section there is a line for early distributions from pension plans....put in 10% of your distribution amount there.

This information will be reported to the IRS as well, so if you don't report it they will correct your return.

The rule is that if your distribution amount is less than $200 then they won't withhold anything from the check...but that's just withholding. You will still be subject to reporting and taxation of that amount.

Answer 3

yes you have to have it on your tax return...and they withhold 25% for taxes and u will probably get a portion of this on your return, if you r under 591/2 however and did not draw out for say first home purchase etc, be ready to have a 10% penalty added to your tax amount this year which reduces your refund this is 10% of the amount withdrawn if 590 then 59 penalty...but u should get a stmt from the financial grp which cut you the check
happy filing!!!!!!!

Answer 4

You should receive a 1099-R with respct to that transaction, with the amounts disbursed and withheld for federal taxes.

Theoretically, report everything, especially since there's money withheld for taxes, because you may be entitled to a refund for the year if, on balance, you overwithheld on income.

Answer 5

No it is not true. you should recieve a 1099 with the information. you will also get penalize for early withdrawl for not putting the money back into another 401k.