Withdrew $150,000 out of retirement pension due to total disability. The 1099-R shows the $150 as taxable income, taxable amount not determined, Federal & state taxes withheld, and box 7 has code 3 (disability).
Isn't all of the taxes withheld due back? The State allows all of the state amount to be returned, due to disability.
For Federal purposes, is the withdrawal taxable, and only the 10% penalty is waived?
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As far as the federal is concerned, you are correct. The early withdrawal penalty (10%) is waived. However, you must pay income tax on the withdrawal.
As far as the state is concerned, we would need to know which state you are in.
As far as the federal is concerned, you are correct. The early withdrawal penalty (10%) is waived. However, you must pay income tax on the withdrawal.
As far as the state is concerned, we would need to know which state you are in.
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K_Smitty
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emc8141945
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