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401k Liquidation and IRS question
Posted on 4/20/14 at 10:11 am
Posted on 4/20/14 at 10:11 am
I received a letter from the IRS last week (CP 2000 letter) saying I owed them $7500 for taxes/penalty/interest on 20k of a 401k I liquidated in 2012.
When I liquidated this money I paid the 10% penalty and they took taxes out so I got a check for around 12k.
I accidentally put this income in line 16a (pensions) instead of 15a (IRA). So it is accounted for on my taxes.
Does anyone have any experience with a situation like this or any advice on information to have available before I call on Monday?
Thanks for your help
When I liquidated this money I paid the 10% penalty and they took taxes out so I got a check for around 12k.
I accidentally put this income in line 16a (pensions) instead of 15a (IRA). So it is accounted for on my taxes.
Does anyone have any experience with a situation like this or any advice on information to have available before I call on Monday?
Thanks for your help
1
Posted on 4/20/14 at 1:44 pm to KJason
Isn't the fee like 30%
Posted on 4/20/14 at 1:45 pm to tigerbacon
Taxes are around 30% and fee is 10%
Posted on 4/20/14 at 5:15 pm to KJason
Both are wrong.
It is your marginal rate (including the withdrawal as income) plus 10%
It is your marginal rate (including the withdrawal as income) plus 10%
Posted on 4/20/14 at 6:24 pm to Volvagia
Any idea on the IRS aspect?
Posted on 4/20/14 at 6:31 pm to KJason
Take it to a firm that deals with these things
Posted on 4/20/14 at 8:50 pm to KJason
Send in a corrected 1040 with the info in the appropriate box and check the part of the letter that says you disagree with the changes they've made.
If the you reported the taxes withheld correctly, it shouldn't be an issue, they have their money. They just don't have info that matches in their system.
Make sure you did report the withholding correctly too though.
If the you reported the taxes withheld correctly, it shouldn't be an issue, they have their money. They just don't have info that matches in their system.
Make sure you did report the withholding correctly too though.
Posted on 4/20/14 at 9:02 pm to ProjectP2294
Thanks. I'll call you tomorrow
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