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

    Sep 6, 2011, 03:52 PM
    Withholding and tax liability on withdrawal of IRA
    I am a non-resident alien (citizen of India), married, age 63. If I withdraw $3650 from my IRA account with a mutual fund, (1) will there be any withholding by mutual fund? (2) will there be any tax liability?
    AtlantaTaxExpert's Avatar
    AtlantaTaxExpert Posts: 21,836, Reputation: 846
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    #2

    Sep 7, 2011, 04:45 AM
    Because you are overseas (and assuming the mutual fund is aware of that fact), the mutual fund, by law, MUST withhold 20% of the distribution to ensure that you pay the tax on this distribution as income.

    You can claim the excess withholding as a refund by filing a non-resident alien tax return (Form 1040NR or 1040NR-EZ) in January 2012.
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