When you take a distribution, the tax is not determined until you file your tax return. Your tax rate is determined by your total income, so if you had other income you may pay more than just the amount withheld. The 10% penalty is applied if you took the distribution early and an exception does not apply. This is in addition to the regular income tax on the distribution. For more information, please see Retirement topics - Exceptions to tax on early distributions.
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