- 3 - Information"; and (4) "Withholding Election". In the "Distribution Reason" section, box number 1 was checked for "Premature Distribution. Under 59-1/2 and no other exceptions apply". Under "Withholding Election", the box was checked for "I elect to have Federal income tax withheld from my IRA distribution (10% withholding)". The amount of $2,518 is listed in the "Payment Information" section as the amount of Federal income tax withheld and the net distribution is listed as $22,662. On January 12, 1998, pursuant to the terms of the QDRO, $17,895 was distributed from petitioner's IRA at PCB to his former wife. At the same time, the balance of the IRA, $25,180, was distributed to petitioner as described above. Petitioner was not yet 59-1/2 years old at the time of the distribution. PCB issued to petitioner a Form 1099-R, Distributions From Pensions, Annuities, Retirement or Profit-Sharing Plans, IRAs, Insurance Contracts, etc., showing a gross and taxable distribution of $25,180 and Federal income tax withheld of $2,518. Petitioner filed his Federal income tax return for 1998 in which he reported the distribution of $25,180 as income on line 15b. Petitioner, however, deducted on line 30, "Penalty on early withdrawal of savings", $2,518, and failed to report any amount in the "Other Taxes" section on line 53 of his return, "Tax on IRAs, other retirement plans, and MSAs. Attach Form 5329Page: Previous 1 2 3 4 5 6 7 8 Next
Last modified: May 25, 2011