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Employee
January 28, 2020
Question

Why am I being asked to pay the same IRA distribution penalty when i already paid it? It's not even like it's a difference of the estimate but the same amount paid.

  • January 28, 2020
  • 1 reply
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1 reply

ColeenD3
January 28, 2020

If you are looking at the 20% tax withheld on your 1099-R, it does not cover your entire penalty. Half that amount goes toward any tax you would owe and the balance toward your penalty. It is an automatic withholding amount and is not intended to pay your entire liablity, just an approximation.