Feb 17, 2010 from
Anonymous
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$0.00
when do you know if you should file a 5329 form for taking money out of my 401k because I was separarted from my employer?
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I am an IRS Enrolled Agent and have 9 years tax, retirement and financial planning experience. I am always working for my clients' best interest, and search for ways to benefit you, even if that means spending additional time planning and explaining. I am most concerned with understanding and planning for the whole financial experience of the individual, business or family. View Profile
I see that your question from February has not been answered yet. I am new to this site as of last week, but not new to retirement taxation. If you withdrew money from a 401(k) or similar plan prior to attaining age 59.5, you'll probably need to pay the 10% penalty tax for doing so, and fill out and submit the 5329. There are several exceptions from the penalty tax (not the Form): disability, quitting/retiting from that job in the year of your 55th birthday, taking out a stream of subtantially equal periodic payments (SEPP) and a few others. To show that you qualify for the exemptions, you'll also need to file the form in most cases. If you are still watching for an answer, please let me know if this was helpful.
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