When I left my job this year, I withdrew my 457 and AZ State Retirement pension to use for relocation expenses.
As is their normal procedure, IRS witholding was taken out. My question is, does the amount that is typically withheld enough to cover the anticipated tax liablity when I file for my 2022 taxes?
I am just trying to anticipate what my tax liablity would like like for this year?
"The 457 was $8K before the IRS withholding. And the ASRS was an early distribution, which amounted to $60K before the IRS withholding. "
If this was the only income. You may be okay. You may be in the 22% tax bracket, but that does not mean that your effective tax rate is 22%. Your effective tax rate may be lower to take into account the value of the standard deduction and your filing status.
Since you did not use specific amounts the answers will be general.
The IRS withholds 20% of the early withdrawal. However if your tax bracket is higher than 20%, you will have a balance due. Regardless of your age, you are not subject to a 10% early withdrawal penalty on distributions of 457(b) plan contributions and earnings. Regarding the AZSR, it is not clear what you withdrew. Was it the contributions? An early distribution? A loan?
Feel free to come back and ask for more information when you clarify the question.
Hello. Thanks so much for responding. Here are more details.
I am currently 56 years old The 457 was $8K before the IRS withholding. And the ASRS was an early distribution, which amounted to $60K before the IRS withholding. I did not roll over any of the funds.
I am just trying to anticipate how much I will owe in taxes for 2022, if any, just in case not enough was withheld to offset my tax liability.
"The 457 was $8K before the IRS withholding. And the ASRS was an early distribution, which amounted to $60K before the IRS withholding. "
If this was the only income. You may be okay. You may be in the 22% tax bracket, but that does not mean that your effective tax rate is 22%. Your effective tax rate may be lower to take into account the value of the standard deduction and your filing status.