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    SHANNONSTEVEN Posts: 1, Reputation: 1
    New Member

    Feb 4, 2008, 04:15 PM
    401k withdrawl
    My husband took out his 401k early because he no longer works there. We are trying to understand the rules for taxes. It seems that is you took out the early due to no longer employed, the 10% tax penalty is waved. There were taxes withheld on the 1099-r. is this correct or not
    ScottGem's Avatar
    ScottGem Posts: 64,966, Reputation: 6056
    Computer Expert and Renaissance Man

    Feb 4, 2008, 04:55 PM
    Who told you the penalty is waived? That's just not so. The amount of the distribution, as listed on the 1099, is added to your income for the year. The amount withheld is added to your salary withholding. Then you figure your tax liability and add the 10% penalty.
    AtlantaTaxExpert's Avatar
    AtlantaTaxExpert Posts: 21,836, Reputation: 846
    Senior Tax Expert

    Feb 6, 2008, 01:39 PM

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