IRA Rules

Question: How do calculate 10% excise tax on IRA withdrawl?

I think i have failed to pay the early withdrawl 10% tax on my 72T for some past years.

Say I had $100,000. in my IRA and was supposed to take 4%
a year over 12 months until age 591/2.

I did take some additional withdrawls. My question is this.
Is the 10% tax on the additional withdrawls or 10% of $100,000? Sorry if I am confusing you. there are so many rules confusing me.
I have already paid the state tax and regular income tax on the withdrawls. I just faild on the 10%
Honestly,, I became aware of the problem when i got sober. I was lying to myself and the IRS.
The IRS did not call it to my attention.
My CPA mentioned it.
I a bit freaked-out. I need to be honest to stay sober. I will owe over 100K

Answer: From my understanding and experience of this issue the IRS may attempt to assess 10% on all of the entire withdrawal since the additional withdrawal has violated the 72(t) exception. There is some question if they (the IRS) have the ability to catch the problem absent any other reason for them to have looked at the return. Therefore the best approach to this question may come from an understanding of how the problem came to your attention.

For the returns to have been filed correctly in the first place the preparer would have included a IRS Form 5329 and excluded the 72(t) portion on line 2 of that form and assess a 10% penalty on the remainder. If you wish to be correct you should file an amendment (1040X) to include the corrected IRS form 5329. But again the means by which you became aware of this oversight may dictate another answer.

Roth IRA: The New Rules (Part 2 of 2)

Related posts

• Traditional Ira Tax Rules
• Traditional Ira Distribution Taxes After 60 Years Of
• Traditional IRA
• Rules For Converting Traditional Ira To Roth Ira
• Rules For Converting A Traditional Ira To A
• Ira Transfer Rules Irs
• IRA Rollover