Question

ex H1-B tax refund on 401(k) distributions

Forum|Forum|6 years ago
February 3, 2020
1 reply
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I have was on H1-B for 7 years and recently moved out of U.S.A. permanently. I withdrew my 401(k) in 2019 and was taxed on employer contribution.
Using the information, from my 1099-R (2019), TurboTax says I am eligible for a refund. However, there is no way for me to get the refund as:
1. A deposit into a foreign account.
2. A check which I can give to my Australian bank. They charge a fee for US checks, but can process them.
3. A deposit into someone else's U.S. account. They could transfer me the money overseas.

I am sure someone else must have hit this issue before. Any suggestions ?

K

KarenJ2

If you had a total distribution of your 401(k) plan, the entire withdrawal will be taxed as income by the US. Contributions to a 401(k) account are made with pretax dollars, that means the entire amount you withdraw is included as US source income.

If you are not yet 59 1/2 year old, you also have an 10% early withdrawal penalty.

I am not sure why you were only taxed on employer contributions. I assume that you had withholding on the withdrawal.

You can have the IRS mail your refund check to your home address or use a friend's US bank account for deposit.

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