View Full Version : 401k withdrawal
kisjal
Jul 10, 2009, 04:08 PM
I was laid off from my job. How will I be taxed on my 401k withdrawal in the amount of about $3100. I am 59 years 9 months old .
AtlantaTaxExpert
Jul 13, 2009, 07:05 AM
Because you are over the age of 59.5 years of age, you will NOT owe the 10% Early Withdrawal Penalty.
However, the 401K withdrawal WILL be taxed as ordinary income at both the state and federal level. Exactly what percentage is determined by your overall income level as of 31 December 2009 and in which state you are located.
ebaines
Jul 13, 2009, 12:38 PM
Not to be too picky, but actually anyone who is "separated from service" in or after the year he or she turns 55 is exempt from the 10% early withdrawal penalty.
AtlantaTaxExpert
Jul 13, 2009, 02:18 PM
Noted about the early "separated from service", but not an issue here given his age.