Sign Up

Why sign in to the Community?

  • Submit a question
  • Check your notifications
or and start working on your taxes
cancel
Showing results for 
Search instead for 
Did you mean: 
angel_girlie_06
New Member

I had received a check from a previous job from my 401k. I now have a 1099-R to report and now I’m being penalized for it. How does this work? Since I quit the job what I paid in would be mine co

 
2 Replies
JohnB5677
Expert Alumni

I had received a check from a previous job from my 401k. I now have a 1099-R to report and now I’m being penalized for it. How does this work? Since I quit the job what I paid in would be mine co

When you contributed to your 401 K your income on your W-2 was reduced by that amount and you didn't pay taxes on it.  Now,  because the money was taken out.  The IRS wants the taxes.  In addition, if you're not 59 1/2 when it comes out, you will pay an additional 10% penalty.

 

The only thing you could have done is to transfer (roll it over) into an IRA.  Unfortunately, that is not an option now.

**Say "Thanks" by clicking the thumb icon in a post
**Mark the post that answers your question by clicking on "Mark as Best Answer"
VolvoGirl
Level 15

I had received a check from a previous job from my 401k. I now have a 1099-R to report and now I’m being penalized for it. How does this work? Since I quit the job what I paid in would be mine co

Or there is an exception to the 10% Early Withdrawal Penalty if you were 55 or older when you left that job.

 

Sorry if you owe the 10% Early Withdrawal Penalty you had 60 days to roll it over to a IRA to avoid the tax and penalties.

Dynamic AdsDynamic Ads
Privacy Settings
v