1099-R

[oxyjock]

I took $10,000 out of my ira. On my place in the 1099r form, I'm behind taxed on the $10,000 plus the taxes paid. Why am I being taxed on my taxes? 

[xmasbaby0]

I PAID TAX ON THE RETIREMENT MONEY ALREADY

You had tax withheld from the distributions from the retirement account, just like when an employer withheld tax from your paychecks.  When you enter it all into the software, the calculations are done to reconcile the amount of income you received and the amount of tax that was withheld.  You might owe more or you might get a refund.

[Bsch4477]

You owe tax on the entire amount withdrawn. Any tax withheld will be applied to your tax liability. 

[VolvoGirl]

Was the 10,000 the amount you got after taxes?   Then you really took out more including the tax withholding.  How much is on 1099R box 1?   The total gross amount is included in your income.

You didn’t actually pay the tax or the 10% penalty (you pay a 10% early withdrawal penalty if you are under 59 ½). You had taxes withheld like from your paycheck. You still have to enter the whole gross amount (before taxes were withheld) with your other income to figure out the total tax (and it may put you into a higher tax bracket) and then the withholding is subtracted from the total tax to figure your refund or tax due. The Gross amount shows up on 1040 line 4a or 5a and the taxable amount on 4b/5b.  You will get credit for the withholding on 1040 line 25b.

It has to break out and show the 10% penalty separately on your return (schedule 2 line 8 which goes to 1040 line 23). Then you get credit for all the withholding taken out on 1040 line 25b.

[oxyjock]

I received  $10,000 from my IRA. That's what I received into my bank account. A total of $11,627.91 was taken from my IRA. On the form 1099R that I got in the mail has $11,627.91 in box 1 and $11,627.91 in box 2. Box 4,federal tax, says $1,162.79 and box 14 says 465.12. $1,162.79 + $465.12 = $1,627.91. $11,627.91 - $1,627.91 = $10,000. So, is the number in box 2 actually in error and should be the $10,000 that I actually received? 

[VolvoGirl]

No.  Box 2 is right.  You are taxed on the full amount that came out of the IRA, not just the amount you got.  As I said above you didn’t actually pay the tax.   You had withholding taken out like from your paychecks.   On your tax return you have to enter all your income to figure the total tax.   Then all your withholding is subtracted to give you a refund or tax due.