When you took money out of your retirement plan, the custodian of the account had to withhold a percentage for federal tax. But.....that is just like when your employer withholds tax. Sometimes they withhold more than necessary, sometimes not enough. When you prepare your income tax return, you enter the amount that was withheld and then the software reconciles the amount withheld with the amount you really owe. And...if you were younger than 59 1/2, you face a 10% early withdrawal penalty on top of the ordinary tax.
You just have to enter the 1099R and make sure you enter the amounts from all of the boxes on it correctly, and let the software calculate your tax.
You will see the amounts on lines 5a and 5b of your Form 1040.
**Disclaimer: Every effort has been made to offer the most correct information possible. The poster disclaims any legal responsibility for the accuracy of the information that is contained in this post.**
