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I'm trying to answer this question: Did I use my IRA to pay for these expenses? I checked this box: ANOTHER REASON. I paid taxes owed for the prior yr. Is this okay?
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I'm trying to answer this question: Did I use my IRA to pay for these expenses? I checked this box: ANOTHER REASON. I paid taxes owed for the prior yr. Is this okay?
Yes. Sometimes if you use the money for specific things such as higher education, you can exclude the penalty for early withdrawal.
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I'm trying to answer this question: Did I use my IRA to pay for these expenses? I checked this box: ANOTHER REASON. I paid taxes owed for the prior yr. Is this okay?
No. Using the money to pay taxes is NOT an acceptable "other reason" for an exception the early-distribution penalty.
The only permissible "other reason" as an exception to the early-distribution penalty on a distribution from an IRA is if the Form 1099-R has code 1, code J or code S but the distribution was actually made after you had reached age 59½.
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