2007-09-29 16:55:02 · 7 answers · asked by corsby 1212 1 in Business & Finance ➔ Taxes ➔ United States
Yes, such withdrawals are subject to backup withholdings, and you will receive the statement.
Withdrawals before the age of 59½ is "Early withdrawal." “Early Withdrawal is subject to 10% penalty. Also the withdrawal will be taxed at your normal income tax rate. However, in some case there is no penalty on early withdrawals.
*If distributions are for qualified higher education expenses,
*You have unreimbursed medical expenses that are more than 7.5% of your adjusted gross income. The distributions are not more than the cost of your medical insurance.
*You are disabled.
* The distribution is due to an IRS levy of the qualified plan.
*The distribution is a qualified reservist distribution.
2007-09-29 17:50:59 · answer #1 · answered by MukatA 6 · 0⤊ 0⤋
Now why do you want to do this? If you touch your money then your 401k Administrator is going to withhold 20% for tax purposes. If you don't put your money in a qualified retirement plan within 60 days then you will be subject to a 10% IRS penalty plus your money is fully tabable at that point (401k contributions are not tax). If you do place your money in another qualified retirement plan within 60 days you have to pay the full 100% then go back to the previous 401k Administrator to get your 20% witholdings back. It is a lot easier and cheaper just to transfer the money from one plan to another without touching it.
2007-10-03 12:46:03 · answer #2 · answered by Gary 5 · 0⤊ 0⤋
Yes, you'll get a 1099R showing the amount you withdrew, and any taxes that were withheld. On your tax return, you'll report the withdrawal as retirement income, and the taxes withheld as withholding.
2007-09-30 22:00:42 · answer #3 · answered by Judy 7 · 1⤊ 0⤋
Yes. Anytime you take a distribution you will get one at the end of the year.
2007-09-29 23:57:31 · answer #4 · answered by stevejensen 4 · 0⤊ 0⤋
Big mistake. I ended up paying about 50% in taxes when I did this. Don't do it!!!!
2007-09-30 00:02:26 · answer #5 · answered by s7e28w81 5 · 1⤊ 0⤋
Why on earth would you do that?!?!!?!?! You will pay taxes plus a 10% penalty and you will be losing money that was put away for your future.
Don't do it!!!!
2007-09-29 23:57:55 · answer #6 · answered by Anonymous · 1⤊ 0⤋
YES ,AT THE END OF YEAR YOU WILL GET A FORM TO FILE WITH YOUR TAXES
2007-09-30 00:06:09 · answer #7 · answered by nick h 1 · 0⤊ 0⤋