My wife quit her job in March of last year and we took an early withdrawal from her 401k to pay off debt. Is there anything special I should know about this?

[zrcole]

We paid the 10% penalty, federal and state tax all up front.

[Opus 17 · Accepted solution]

The tax you paid was only an estimate.  You need to report the withdrawal on your tax return from a 1099-R and you will get credit for the withholding.  Your overall tax will be calculated and you might owe more or get a refund.

[zrcole]

Thank you,  I am assuming I will receive a form from either the state, fed, 401k holding company, regarding the withdrawal and the tax payments, and penalty payments?

[Opus 17]

You will receive a 1099-R from the plan trustee.  It may be already available online, if not, they are supposed to mail it by January 31.  If you have moved, you should call them to make sure they have the correct address.  The 1099-R form will show the gross amount of the distribution and the tax withheld.  The plan trustee will report on form 1099-R that it was a non-qualified withdrawal (not over age 55 in the year of separation or not over age 59-1/2 overall) and then the tax forms will add the penalty.