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liontoes
New Member

59.5 withdraw medical?

I need to take a 59.5 withdraw from my retirement to cover oral surgery. I am paying the 20% penalty but on next years taxes is there a break if the reason for the withdraw is medical and is oral surgery considered medical?

3 Replies
DoninGA
Level 15

59.5 withdraw medical?

If you are age 59.5 or older when the funds are withdrawn there is no early withdrawal penalty.  The taxable amount of the retirement fund withdrawal is entered on your tax return as ordinary income and taxed at your current tax rate.
VolvoGirl
Level 15

59.5 withdraw medical?

The 20% is probably withholding like withholding on your paychecks. You get credit for it. That shows up on your tax return on line 64 with your other withholding and is subtracted from your tax liability.
Opus 17
Level 15

59.5 withdraw medical?

Oral surgery is a deductible medical expense unless it is cosmetic surgery.  

There is a penalty exemption for medical expenses but it only applies to expenses that are more than 7.5% of your adjusted gross income and only applies to the share of the expense that is more than the 7.5% floor.  

*Answers are correct to the best of my ability at the time of posting but do not constitute legal or tax advice.*
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