Skip to main content
February 27, 2025
Question

Do not understand why I got total tax before credits that includes an additional tax on IRA and tax favored accounts.

  • February 27, 2025
  • 1 reply
  • 0 views
No text available

    1 reply

    February 27, 2025

    The IRS imposes a 10% additional tax on certain early distributions from certain retirement plans. The additional tax is equal to 10% of the portion of the distribution that's includible in gross income.

     

    Also, Many tax-favored accounts, including IRAs, 401(k)s, HSAs, ESAs, and ABLE accounts, have annual contribution limits. The IRS imposes a penalty of 6% of the excess amount for each year that it remains in your account. You have until the tax filing deadline or extension deadline, if you file for a tax extension, to withdraw your excess contributions.

     

    irs.gov

    Additional Taxes on Qualified Retirement Plans

    **Say "Thanks" by clicking the thumb icon in a post**Mark the post that answers your question by clicking on "Mark as Best Answer"