Hi and welcome to Just Answer!What type of retirement plan you have?
This is from my ex-husbands retirement plan. One is a 401(k) Pension Plan the other is The Retirement Security Plan.
This is from my ex-husbands retirment plans. One is a 401(k) Pension Plan, the other is The Retirement Security Plan.
For distributions from 401(k) Pension Plan - if distributions are made to an alternate payee under a qualified domestic relations order (QUADRO) - such distributions are not subject of early distribution penalty.See for reference IRS publication 575 - page 31 - http://www.irs.gov/pub/irs-pdf/p575.pdf - Additional exceptions for qualified retirement plans.For the Retirement Security Plan - you need to contact the administrator and verify if that is a qualified retirement plans - if yes - the same exemption may be used.
What if the funds are used to purchase a home? Would I still have to declare as income and pay taxes, and if so at what rate?
Did you receive my second response?
Regardless how funds are used - as long as you take distribution - that will be your taxable income.Your tax rate depends on your total income, filing status, dependents, other deductions, etc.The tax rate may be from zero to 35% - see last page in this publication - http://www.irs.gov/pub/irs-pdf/i1040tt.pdf Let me know if you need help with estimations.
Thank you Lev.....I would like help with distribution of two amounts. If I take the full amount from both plans, it would total $211,952.01. I may just take one amount of $39,755.39. As far as additional income for this year, would probably only be an additional $5K if even that. Can you help me with tax estimates on the two amounts? I am 58, divorced and both my children are married. Thanks so much.
So far, you will file your tax return as Single, no dependents, assuming standard deduction:with total income $5000 + $39,755 (taxable distribution) = $44,755 - your estimated federal income tax liability would be $4650with total income $5000 + $211,952(taxable distribution) = $216,952 - your estimated federal income tax liability would be $53,600.
Thank you so very much Lev....this has been very helpful to me in making some important decisions. Your service has been greatly appreciated!
You are welcome. I am glad to be helpful.
To save this information for my review, please assist me how to forward to my email, or do I need to access via your website? I just want to have access to this information at any time. Thanks
Here is a link to this page - http://www.justanswer.com/tax/52tnz-receive-moneys-retirement-plan.htmlPlease bookmark it - and you will be able to come back any time for reference or to ask additional questions. I do not have control over emailing content and do not have access to personal information (email, etc).