I made an early withdrawal from my SIMPLE IRA this year. I withheld 15% for federal taxes and 5% for state taxes. I live in OH. Was that enough, or too much?
I was told there would be an additional 10% come out, but I'm not sure that it's right. I got $5,844.46 of gross. $1,096.83 went to Fed taxes (15%) and $365.27 went to State (OH) taxes (5%). Will I still owe something come tax time?
10% tax You have to pay a 10% additional tax on the taxable amount you withdraw from your SIMPLE IRA if you are under age 59½ when you withdraw the money unless you qualify for another exception to this tax. In some cases, this tax is increased to 25%.
25% tax The amount of the additional tax you have to pay increases from 10% to 25% if you make the withdrawal within 2 years from when you first participated in your employer's SIMPLE IRA plan.
Any early distribution penalties will be entered on your federal tax return, Form 1040, as a tax liability.