What percentage would be withheld from an IRA withdrawal?

[melvol62]

Is it possible for someone to tell me what TOTAL percentage of an early IRA withdrawal would be taken out if our adjusted gross is under 70K? Tax plus penalty? I'm trying to gauge how much xtra to take out to, essentially, even out a bit what's removed (next year we will file for hardship withdrawal status because it's for medical bills,but I want taxes/penalty withheld upon withdrawal so we don't get hit next year). 

When withdrawing, are you usually asked if you want taxes and penalty withheld? Do they determine your bracket for withholding?

Thanks so much!

[MichaelL1 · Accepted solution]

I can give you a pretty close number.  22% for Federal and then depending on the state you live in perhaps 5% for state taxes (if you have state income tax.

First, the amount you tax out will be added to the other income in the return, so it would be added to the $70K or so already being reported on the return.

You say "we" so assuming married filing a joint return.

So if you don't take out say more than $10K or $15K, the tax rate should stay in 12%, and the early withdrawal penalty will be 10% so a total of 22% for Federal and then depending on the state you live in perhaps 5% for state taxes (if you have state income tax).

The reason for the penalty is that even with medical you can only exclude the penalty for the amounts that exceed 7.5% of your AGI (so $70,000 plus $15,000 taken out, is $85,000 times 7.5% is: $6,375 that would not be excluded from the penalty in my example). 

If you do overpay you would get this back when you file the 2018 return. 

 2018 income tax brackets.

2018 Income Tax Brackets

Tax Rate Married Filing Jointly--This is taxable income (which would be in very simple calculation your income less the $24,000 standard education in 2018)

10% Up to $19,050

12% $19,051 to $77,400 

22% $77,401 to $165,000