Ask Terry Questions Taxes on a company plan withdrawal?

Taxes on a company plan withdrawal?

By Terry Savage on January 18, 2017 | Wild Card

I contributed to a company tax deferred plan. I retired & I am 62 yo. In 2016 I withdrew 12,000 but had no other income coming in. What will I have to pay on taxes for taking this ? I am single.

Terry Says

Yes.  All withdrawals from a qualified retirement plan are considered taxable as ordinary income.  BUT, since this is your only income (and assuming you do not yet collect Social Security), then your income will fall below the taxable level.  However, you should file a return, because the company will give you a 1099 (with a copy to the IRS), so they will be looking to match it up to your return.  So be sure to file, indicating no taxes are due.  Get some help, which should be free at your local senior center or many tax preparers since you have so little income.  But you want to make sure it is filed correctly.



a personal
finance question