turbotax icon
cancel
Showing results for 
Search instead for 
Did you mean: 
turbotax icon
turbotax icon
turbotax icon
turbotax icon
cancel
Showing results for 
Search instead for 
Did you mean: 
Close icon
Do you have a TurboTax Online account?

We'll help you get started or pick up where you left off.

I'm retired and would like to pull money out of 457. what forms do i need to fill out and submit in order to pay taxes without a penalty? can I do that with turbo tax?

 
Connect with an expert
x
Do you have an Intuit account?

Do you have an Intuit account?

You'll need to sign in or create an account to connect with an expert.

2 Replies

I'm retired and would like to pull money out of 457. what forms do i need to fill out and submit in order to pay taxes without a penalty? can I do that with turbo tax?

You just make a withdrawal from the 457 plan.  If you are over 59 1/2 there is no penalty.  You will get a 1099R at the end of the year to enter into your tax return.   They will probably take out a set amount of withholding or you can tell them what percentage to take out.  Be careful.  It will all be taxable and may push you into a higher tax bracket.  

I'm retired and would like to pull money out of 457. what forms do i need to fill out and submit in order to pay taxes without a penalty? can I do that with turbo tax?

You may want to use the IRS tax withholding estimator to determine your withholding, or speak to a financial advisor.

https://www.irs.gov/individuals/tax-withholding-estimator

 

Depending on your marital status and other sources of income, you could pay between 10% and 36% income tax on your withdrawals.  Also, if you withdraw more than about $15,000, this taxable income will also make your social security taxable.  (It's a more complicated formula, $15,000 is a very rough guideline).    Plus 3%-13% for state income tax depending on which state you live in.

 

Your plan trustee will withhold whatever amount of tax you tell them, or you can take the withdrawal without withholding, but you will need to make quarterly payments to the IRS and your state tax authority, both to avoid a big tax bill when you file and to avoid a penalty for not paying throughout the year. 

 

As mentioned, your total withdrawals will be reported to you on a form 1099-R that the account trustee will mail you (or make available for download) by January 31 next year, and you enter that information on your tax return along with your other income, deductions, and credits.

 

If you just retired, it would probably be a good time to meet with a financial advisor and do some basic planning.  

Manage cookies