Financial Information
Early withdraw of retirement plan?
Question : Early withdraw of retirement plan?
I had 89 thousands dollars in my retirement fund,i got 67 thousand dollars after federal and states taxes are held.My question is do i owe 10 percent on the whole 89 thousand or do i owe just on the 67 thousand
early retirement planning
Best answer:
Answer by BeenAroundTheBlock
The whole 89 thousand.
-
-
#2 written by terriyaki247 1 year ago
YIKES! Yes, you owe 10% federal penalty on the entire 89k amount.
I have a friend who also withdrew from her retirement account recently. First of all, are you sure state taxes are withheld? I would check twice. I have a feeling that state taxes aren’t withheld from the check…. Second, some states also have a early withdraw penalty. That’s what happened to my friend. She thought after federal income tax and penalty, she’d get the remaining amount…. until she realized that she has to pay state income tax PLUS state penalty. For California (where she’s at), it’s her regular income tax rate (top bracket 9.3%) plus a 2.5% penalty. It was a total shock when she realized that she owes $ 5000 to the state….
-
#3 written by shiprepairwoman 1 year ago
They only withhold 20% for federal tax I don’t know what they do for state taxes. You will claim the entire 89K as income so it is added to your other income. The penalty is 10% and the tax is your marginal rate so if this puts you at 25% federal it you will pay 35% with penalty so still owe about 14K to the fed and whatever your state tax and penalty is.
I am sorry you had a tragedy that made you take this very expensive move. I hope you are able to retire someday this will set you back a lot of years. - Comment Feed for this Post
10% on the $ 89k.
sorry.
man, thats another $ 8,900 you owe.