dmertz
Level 15

Retirement tax questions

Default withholding on a traditional IRA distribution is 10%, not 20%, but the recipient can optionally request that nothing be withheld (as was done in this case) or that more than 10% be withheld for federal taxes.

 

Because the US tax system is a pay-as-you-go system, having taxes withheld can be helpful in avoiding a tax  underpayment penalty.