Inherited IRA (2021)

Forum|Forum|2 years ago
October 25, 2023
1 reply
10 views

I had 10% tax deducted when I withdrew all of $42k beneficiary IRA account. Can expect to have to pay more?

Ask the Experts - Extension - Sept 2023

RyanH5

Employee Tax Expert

Assuming that it was a Traditional IRA and not a Roth IRA, the income received is treated as ordinary income to you. As such, it will likely get taxed at your full nominal rate. To find out what federal tax bracket you fall in, you will need look at your most recently filed tax return and look for the "Taxable Income" amount. For 2022, this is found on line 15 of your 1040. You can then compare that figure with the tables found here.

This nominal rate multiplied by the amount you received will likely be the total amount of tax liability for the benefits.

Please keep in mind that depending on what state you reside in, you may also owe state income taxes as well.

**Say "Thanks" by clicking the thumb icon in a post. **Mark the post that answers your question by clicking on "Mark as Best Answer"