dmertz
Level 15

Retirement tax questions

Although it doesn't affect the tax consequences in this scenario, if the company is required to withhold 20%, the account is not an IRA but is an account in a qualified retirement plan like a 401(k).  An IRA is subject to 10% default withholding but you also have the options to have 0% withheld or more than 10% withheld; withholding is not mandatory on any distribution from an IRA.