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tonysqueen15
New Member

I already paid the taxes on my IRA

I paid my taxes on my IRA why is it saying I need to pay it?
1 Reply
jerry2000
Alumni

I already paid the taxes on my IRA

The amount withheld from your distribution was only an estimate, just like withholding from your paycheck. The exact amount of tax is not known until you prepare your tax return, because it depends on how much other income you have. The distribution is added to your other income  and taxed at whatever your marginal rate is, and the early withdrawal penalty is added, if appropriate. The total amount of added tax may be more or less than what was withheld. You get full credit for the tax that was withheld at the time of withdrawal. You aren't being taxed again, just once accurately.
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