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    peanutbubby's Avatar
    peanutbubby Posts: 1, Reputation: 1
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    #1

    Sep 6, 2011, 12:18 PM
    How is th 10% penalty withheld on a 401K early withdraw reported on 1099
    I am trying to figure out the taz implications for an early withdraw from a 401K. The company withheld thirty percent 20% for taxes and 10% penalty. How are the withholdings reported on 401K
    ebaines's Avatar
    ebaines Posts: 12,131, Reputation: 1307
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    #2

    Sep 6, 2011, 01:22 PM
    You (and the IRS) will receive a 1099-R form in January documenting the withdrawal and taxes withheld. It akso includes a "distribution code" which tells whether the withdrawal qualifies for an exception from the early withdrawal penalty. You report the withdrawal as income on your 1040 tax return line 16 "Pensions and Annuities," the 10% early withdrawal penalty on line 58 "Additional tax on IRAs, other qualified retirement plans, etc.", and the amount of federal taxes withheld on line 61.

    Depending on where you live you may also have to report the withdrawal as income on your state/local income tax return.
    ScottGem's Avatar
    ScottGem Posts: 64,966, Reputation: 6056
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    #3

    Sep 6, 2011, 03:09 PM
    Are you sure the 10% was withheld? Generally it isn't, only taxes are withheld. And generally 20% is withheld.
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