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I got divorced in 2013,I got half of my ex_husband's 401k.The early withdrawal penalty was determined and prepaid by the settlement amount. no income for the year 2014, should i still file federal income tax? i filed an extension just in case it was needed

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    Please clarify which year (2013? 2014?) you received the distribution from your ex-husband's 401k. Also, you seem to imply that the cash amount that you received was reduced by the early withdrawal penalty which was sent to the IRS directly. Is this correct? Finally, does the divorce settlement say anything about the 401k? For properly set up settlements (QDROs), an early withdrawal penalty is not required, and you have the option of rolling over the amount into an IRA if you wish (presumably that ship has sailed already). Commented Jun 20, 2015 at 1:36
  • @DilipSarwate: I received distribution check in 2014 per divorce settlement using QDRO, yes 401 k was mentioned in divorce papers, I live in California, and I wasn't given the option of paying the penalty, it was made for me, penalty was taken from the $40,000. I wanted to use some of the monies for bills and such.
    – Tare
    Commented Jul 2, 2015 at 0:49

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Yes, you should file your tax return. You paid the penalty, but the IRS doesn't know that, they just know that you paid something. Your tax return is the explanation of what it is the IRS got from you.

You might owe income tax on the distribution, in addition to the penalty.

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    401(k) has a mandatory 20% federal withholding. She may owe more or get a refund, depending on he amount involved. Commented Jun 20, 2015 at 18:07

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