Skip to main content
June 6, 2019
Solved

1099-R I entered all the information in to the boxes. I paid federal tax on the lump sum however it is taxing me again on federal, im aware that I need to pay state

  • June 6, 2019
  • 1 reply
  • 0 views
No text available
Best answer by SteamTrain

The withholding done may not have been enough.  As long as you have the withholding in box 4 of the Software 1099-R form, it is being considered.

_______________________________

Example: Person withdraws 40,000 with 20% (8,000) withholding. Early withdrawal. If that extra income happens to be in the 25% bracket on you tax file at tax time, you will still owe another 5%  in taxes PLUS the 10% penalty...or... $6,000 more.

1 reply

SteamTrain
Employee
June 6, 2019

The withholding done may not have been enough.  As long as you have the withholding in box 4 of the Software 1099-R form, it is being considered.

_______________________________

Example: Person withdraws 40,000 with 20% (8,000) withholding. Early withdrawal. If that extra income happens to be in the 25% bracket on you tax file at tax time, you will still owe another 5%  in taxes PLUS the 10% penalty...or... $6,000 more.

____________*Answers are correct to the best of my knowledge when posted, but should not be considered to be legal or official tax advice.*