QUESTION

Is there a tax liability and early withdrawal penalty?

Asked on Dec 12th, 2013 on Taxation - New Jersey
More details to this question:
When I worked for Employer A I took out a 401k loan to purchase a primary residence. Now I work for Employer B and wanted to rollover my 401k. In order to do that I had to pay the balance of the 401k loan. I did so using the funds from an annuity I have that was created from a pension payout from a previous employer. To avoid early withdrawal penalties my goals was to take out a 401k loan with Employer B and repay the annuity before 60 days. Due to a series of missteps with Employer A's administrator the 60 days have nearly lapsed. They've offered to write a letter detailing their missteps but I'm not sure if that helps with the IRS, and then the plan with the annuity said there would not be a tax liability or early withdrawal penalties, but my financial advisor said there would be. Please advise. I tried to repay the loan and stayed on top of the administrator but their mistakes cost me precious time. Thank you.
Report Abuse

1 ANSWER

Criminal Defense Attorney serving Toms River, NJ at Edward J. Dimon
Update Your Profile
you should work closely with your accountant and financial advisor. they have access to all your records. we do not. the IRS has strict rules. i would follow same. ed dimon, esq.
Answered on Dec 13th, 2013 at 12:26 PM

Report Abuse

Ask a Lawyer

Consumers can use this platform to pose legal questions to real lawyers and receive free insights.

Participating legal professionals get the opportunity to speak directly with people who may need their services, as well as enhance their standing in the Lawyers.com community.

0 out of 150 characters