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I received a letter from irs regarding my 2017 return. it has something to do with a taxable retirement income im guessing? i left this dept in 2015 so why now

 
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I received a letter from irs regarding my 2017 return. it has something to do with a taxable retirement income im guessing? i left this dept in 2015 so why now

If you cashed out a retirement account the distribution was reported to the IRS.  Money you take from a retirement account is taxable income. Depending on the circumstances, that money may be subject to a 10% early withdrawal penalty and ordinary income tax as well.   You should have entered a 1099R on your tax return for that for the tax year in which you received that money.  It may have taken this long for the IRS to catch it, but now you need to sort it out with the IRS.

**Disclaimer: Every effort has been made to offer the most correct information possible. The poster disclaims any legal responsibility for the accuracy of the information that is contained in this post.**

I received a letter from irs regarding my 2017 return. it has something to do with a taxable retirement income im guessing? i left this dept in 2015 so why now

"i left this dept in 2015 so why now"

 

I assume you mean you left that job.    Did you have a 401(k) with the company?

 

Even if you did not cash out the 401(k) when you left, many company plans provide that they will automatically roll the 401(k) into an IRA in your name if you do not cash the plan out in a year or two.   If that happened, then they would have sent a 1099-R showing the rollover.   That would not be taxable if reported on your tax return, but failing to report it can result in the IRS assuming that you took the money.   (Just a guess).

**Disclaimer: This post is for discussion purposes only and is NOT tax advice. The author takes no responsibility for the accuracy of any information in this post.**
rjs
Level 15
Level 15

I received a letter from irs regarding my 2017 return. it has something to do with a taxable retirement income im guessing? i left this dept in 2015 so why now

"it has something to do with a taxable retirement income im guessing?"

 

Don't guess about what the IRS letter is about. Read the entire letter carefully and make sure you understand exactly what it's about and what you have to do. If you have trouble understanding it, bring the letter and your tax return to a local tax professional and ask the tax pro to explain it to you.

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