Hello tiffanylalston,
Great question!
Your withdrawal from your 401K will be taxed at your tax bracket, whatever that may be, depending on your taxable income. On the top of that your will be paying 10% early withdrawal penalty. Since we don't don't know what your taxable income or tax bracket is, you may end up having a balance due or a refund when the tax time comes. Depending on what state you live in, you may also be paying state taxes on this withdrawal. Good that you're having them take out 22%, so it will hit you all at the tax time.
If you can provide more info about how much your taxable income will be, and how much you're withdrawing, we may give you a better estimate...
Hope it helps!
Hello tiffanylalston,
Thanks for participating in our Ask the Experts event today. As to your question, I think the best approach would be to use this Tax Calculator to help you esitmate the taxes you may owe based on your situation this year. It says 2022, but it will work well enough for 2023.
Also, if you qualified for the hardship provision you should be able to avoid the 10% early withdrawal penalty. However, if you didn't, I don't think the calculator above includes that 10% penalty on the withdrawal amount, so you may have to add that to they result.
I hope that helps.
Taxable Income is around 60,000 and I took 19,868.00. I currently claim myself (1) for federal and nothing for state.
Hi tiffanylalston,
Assuming you're filing as Single, with this income, you will be in the 22% tax bracket. So if you are having 22% withholding to cover federal taxes and the 10% penalty applies to you, then you will have a balance due at the tax time.