When a 401(k) plan mails the beneficiary a check, the tax damage is already done and nothing in the tax code can undo it. The ...
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He rolled his $400,000 401(k) into an IRA and deposited the check. The $80,000 his plan held back became income to the IRS and Medicare
Quick ReadChoosing a personal check over a direct rollover triggers mandatory 20% federal withholding, turning $80,000 of a $400,000 401(k) into taxable income.The $80,000 accidental distribution hits ...
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