Withdrawals from traditional pretax 401(k) plans are always subject to regular income tax at your regular income tax rate. This depends on your total income for the year, but will probably be 12%, 15%, or 22%. Massachusetts state income tax might be 5%. If the withdrawal is Covid related, you are exempt from the additional 10% penalty for withdrawing the money before retirement.
Whatever tax was withheld from the withdrawal, if any, is only an estimate. You must enter the 401(k) withdrawal on your tax return along with all of your other income, using the 1099 – R form that you will receive at the end of the year. You will get credit for any withholding and your tax return will calculate your overall tax and whether you owe anything additionally or are due a refund.
