I am withdrawing from my retirement to help with inflation. Do I just add this amount to my income than apply the standard deduction to get my taxable income?

Forum|Forum|1 year ago
December 21, 2024
2 replies
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I assume that I have to pay additional taxes while filing as Married filed jointly. I am trying to balance how much to take for emergency vs the tax brackets for 2024. Are their best strategies to consider?

Best answer by xmasbaby0

You will get a 1099R in late January/early February for any money you take from a retirement account. You will enter the 1099R when you prepare your tax return, and that money will be taxed in your tax bracket.

To enter your retirement income, Go to Federal> Wages and Income>Retirement Plans and Social Security>IRA 401 k) Pension Plan Withdrawals to enter your 1099R.

xmasbaby0Answer

Employee

To enter your retirement income, Go to Federal> Wages and Income>Retirement Plans and Social Security>IRA 401 k) Pension Plan Withdrawals to enter your 1099R.

**Disclaimer: Every effort has been made to offer the most correct information possible. The poster disclaims any legal responsibility for the accuracy of the information that is contained in this post.**

fanfare

Employee

Strategy: Other than life-threatening emergency, don't invade your retirement funds for any reason.

Opus 17

Employee

"Do I just add this amount to my income than apply the standard deduction to get my taxable income?"

Yes, but...

If your income includes social security, your SS benefit is tax-free if it is your only income. If you have other income like a pension or withdrawals from an IRA, the social security benefit may also become partly taxable. With enough income, the maximum is that 85% of your benefit would be taxable. Depending on what you are starting from, adding a withdrawal might add to your taxable income in two ways, by adding the gross retirement income and by increasing the percentage of your social security benefit that is taxable.

The calculation is complex, the best way to figure it out is to use a tax program or a tax estimator calculation.

TaxCaster tax calculator