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Returning Member
posted Mar 17, 2024 3:19:55 PM

Early IRA simple distribution

According to the IRS  "distributions made from a SIMPLE IRA plan within the first 2 years of participation incur a 25% additional tax instead of 10%" which seems pretty clear.  I have participated in the plan for at least 4 years but was still charged the 25% penalty.  The 1099-R box 7 code is 1 with the IRA Simple box checked and I don't have any of the valid exceptions.  I'm afraid I still don't understand why I was charged the 25% penalty and have yet to find a clear explanation of this rule.

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Expert Alumni
Mar 25, 2024 7:21:49 AM

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