Hey Dave,
I retired from my main source of employment due to some health issues, but I am not ready for Social Security and I am not yet retirement age at 57. In mid-January of 2014 I had to pull out about $15,000 from my retirement account to help pay the mortgage and bills. I would like to know how to waive any tax fees, if it all possible. I've been working with temporary agencies and that income should be under $25,000.00. What advice can you give me regarding tax filing?
Harry
Harry,
Our answer assumes that your retirement accounts are neither Roth IRA nor Designated Roth accounts. Generally, any distributions you made during the year from other types of retirement accounts will be subject to income tax, unless you have some basis in your accounts. Basis is essentially any after tax contributions you made, such as a nondeductible contribution to a Traditional IRA. You will also be subject to a 10% additional tax on early distributions unless you qualify for one or more of the exceptions. There are a number of exceptions. More information on exceptions for early distributions from IRA accounts is available here, or if the distributions are from retirement plans other than IRAs, here.
Deductibly Yours,
Dave