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Early IRA simple distribution
According to the IRS "distributions made from a SIMPLE IRA plan within the first 2 years of participation incur a 25% additional tax instead of 10%" which seems pretty clear. I have participated in the plan for at least 4 years but was still charged the 25% penalty. The 1099-R box 7 code is 1 with the IRA Simple box checked and I don't have any of the valid exceptions. I'm afraid I still don't understand why I was charged the 25% penalty and have yet to find a clear explanation of this rule.
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March 17, 2024
3:19 PM