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

    Jul 13, 2010, 12:11 PM
    2010 tax consequences for 401k withdrawals
    I understand that withdrawals from 401K accounts during 2010 can be spread over the 2010 and 2011 tax years for tax purposes. I.E. if I take out 100K in 2010, I can pay taxes on 50K in 2010 and 50K in 2011. Is this correct?
    AtlantaTaxExpert's Avatar
    AtlantaTaxExpert Posts: 21,836, Reputation: 846
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    #2

    Jul 14, 2010, 07:34 AM
    Unless there is a change in the tax law of which I am not aware, that is NOT the case.

    If you make the withdrawal in 2010, you pay ALL of the taxes in 2010.
    ebaines's Avatar
    ebaines Posts: 12,131, Reputation: 1307
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    #3

    Jul 14, 2010, 08:37 AM

    jaddison - I think you may be thinking about a provision that allows people to roll their traditional pre-tax IRA to a Roth post-tax IRA and spread the resulting tax payments over two years. This provision for spreading out the tax payments applies only to a conversion from traditional to Roth IRA made in 2010. As AtlantaTaxExpert says - this spreading of taxes does NOT apply to withdrawals from a 401(k).
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