Anonymous
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Retirement tax questions
A nonqualified 529 plan withdrawal is subject to your regular tax rate (what I assume you mean by your W2 rate) PLUS a 10% penalty. It is not taxed at a flat 10%. It sounds like TurboTax is calculating correctly but that perhaps you weren't prepared for the full tax consequence of the withdrawal.
ā€ˇFebruary 16, 2021
4:57 PM