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Asked 3/12/2011
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I lost my job in 2010, I removed my 401k from the employment and moved it elsewhere. I have removed $25k since. How do I report this? as income? and I was also eligible for retirement and receiving my pension as part of my income.
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Answer 1/3 - Submitted 3/12/2011
Answer 2/3 - Submitted 3/13/2011
The amount you rolled from from the 401(k) into another qualified plan will have a 1099-R issued, probably with code G on it. This wouldn't be taxable, unless your "qualified plan" was a Roth IRA.
The $25,000 that you later took out will also get a 1099-R, and this is subject to income tax and possibly the 10% early distribution penalty.
You show both on the tax return as distributions, only the second having any tax effect.
If you didn't roll the 401(k) into a qualified retirement plan, then the whole distribution was taxable.
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