Why sign in to the Community?

  • Submit a question
  • Check your notifications
Sign in to the Community or Sign in to TurboTax and start working on your taxes
New Member
posted Jul 10, 2019 6:22:08 AM

401k withdrawl

i am thinking of leaving my job and withdrawing my 401k money. i don't have state income tax. i know is a penalty fee for early withdrawl what do i owe in taxes on 72,000 dollars? can you assist me with that?

0 2 1406
2 Replies
Level 15
Jul 10, 2019 8:15:17 AM

are you single or married? (affects which tax tables you'll need to use)

 

are you over or under 59 1/2 years old? (if under, there is going to be a 10% tax penalty; if over, no penalty)

 

 

Level 15
Jul 10, 2019 8:20:07 AM

If you don't need the money right away, you can roll it into an Traditional IRA tax free otherwise a 401(k) distribution is taxed as ordinary income at whatever your marginal tax rate is plus an additional 10% early distributions penalty if you are under age 59 1/2 (or age 55 at the time of separation from service).

 

For example, if you are in the 25% tax bracket and subject to the penalty then a 35% tax would be reasonable.