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My 1099-R form shows 20% was withheld for taxes yet I'm being taxed another 10% of the gross distribution now as I attempt to file for 2016. I don't get this, any help?
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My 1099-R form shows 20% was withheld for taxes yet I'm being taxed another 10% of the gross distribution now as I attempt to file for 2016. I don't get this, any help?
When you take a premature distribution form an IRA or pension plan, you pay both tax and a penalty of 10%.The 20% already paid covers your 10% penalty and whatever portion of your tax that falls into the 10% bracket of taxable income. Rarely does this cover all the taxes since you probably are being taxed at a higher rate than 10%. There are possible exemptions to the penalty in the link below. You may possibly be able to take advantage of one of them.
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My 1099-R form shows 20% was withheld for taxes yet I'm being taxed another 10% of the gross distribution now as I attempt to file for 2016. I don't get this, any help?
When you take a premature distribution form an IRA or pension plan, you pay both tax and a penalty of 10%.The 20% already paid covers your 10% penalty and whatever portion of your tax that falls into the 10% bracket of taxable income. Rarely does this cover all the taxes since you probably are being taxed at a higher rate than 10%. There are possible exemptions to the penalty in the link below. You may possibly be able to take advantage of one of them.
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My 1099-R form shows 20% was withheld for taxes yet I'm being taxed another 10% of the gross distribution now as I attempt to file for 2016. I don't get this, any help?
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