All Things Tax

All Things Tax

Like the title says, from the filing process and tax questions to tax policy and reform, you can search and share All Things Tax here. This is the place to find answers to all your general questions that don't fall under the other categories. And just a reminder: questions about software or online filing should be posted in DIY Products.

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Valued Pioneer
Posts: 4
Registered: ‎04-19-2017

Early Withdrawal of IRA

Hi, I am planning to make an early withdrawal from my IRA of $25,000. Can anyone tell me what I will be subject to for penalties and taxes? Is there a flat 10% penalty? does that get paid to Federal at tax time? is there and additional Federal tax? How much is that? is there a MA state tax? How much? Can all this be taken out at time of withdrawal? I'd like to have a reasonably accurate total to avoid a massive tax surprise at end of year. Thanks in advance!

Tax Pro
Posts: 5,442
Registered: ‎02-23-2016

Re: Early Withdrawal of IRA

Hi ryanpmilotte,

 

Welcome to the H&R Block community.

 

There are actually exemptions from the 10% penalty for things like education, medical expenses in excess of 10% of your adjusted gross income, and first-time homebuyer expenses.  Is there anything in particular you're withdrawing the money for?

 

If you do not meet an exemption then you'll be looking at the normal federal and state income plus a 10% penalty at the federal level.  The federal and state tax may or may not actually have to be paid depending on the overall outcome of your tax return.  If you're eligible for credits that will help reduce the federal income tax by quite a bit.

 

If you would like, you may click on my name and send me a private message with your expected income for the year and I'll give you a more exact estimate of what to expect if you qualify for an exemption and what to expect if you don't qualify for an exemption.

 

Louis,

Senior Tax Advisor (Tampa, FL)

Valued Pioneer
Posts: 4
Registered: ‎04-19-2017

Re: Early Withdrawal of IRA

Hi Louis,

I sent you a message yesterday with my income. Did you receive it?

Thanks for your help!

Tax Pro
Posts: 5,442
Registered: ‎02-23-2016

Re: Early Withdrawal of IRA

Hi Ryan,

 

Yes, I saw it and I just sent you a message back.

 

Louis

Valued Pioneer
Posts: 4
Registered: ‎04-19-2017

Re: Early Withdrawal of IRA

Hey Louis,

 

Thanks for your help, I sent you another private message regarding this.

 

Thanks,

Valued Pioneer
Posts: 4
Registered: ‎04-19-2017

Re: Early Withdrawal of IRA

Hi Louis, 

 

I sent you another message a couple days ago, did you see it?