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Deductions & credits
The only way that you can avoid the mandatory tax withholding is by doing a direct rollover of the money to a traditional IRA (where the distribution is paid directly to the receiving IRA, not paid to you, and is exempt from the mandatory tax withholding because such a rollover is nontaxable), then taking distributions from the traditional IRA. Unlike eligible rollover distributions from a 401(k), distributions from an IRA have default federal withholding of 10% but you are permitted to opt out of tax withholding and there is no default Maryland tax withholding.
‎April 29, 2024
6:50 AM