"Intering 401 i pulled out because i quite my job . They sent my a letter saying sense i quit then i needed to be paid in one lump some in put in an ira . So i had them p

[angeliab509]

"Intering 401 i pulled out because i quite my job . They sent my a letter saying sense i quit then i needed to be paid in one lump some in put in an ira . So i had them pay me one lump sum . In section that says situations that may lower your tax bill one chioce says other in other it says mark other if one applys one being "money from deferred annuity contract purchased by your employer because the employers retirement plan or retirement annuity plan terminated . The employer held the annuity contract until you stopped working there."....would i qualify under that ?"

[AnnetteB]

Based on what you described, you would not qualify for the exception that you asked about.

If you cashed out your 401k only because you quit your job, then there is not an exception for paying the early distribution penalty.  Your distribution will be subject to income tax and the 10% early distribution penalty unless one of the other exceptions applies.  The one you asked about would be valid if your employer had terminated the retirement plan for all employees and your amount was distributed to you as a result.