taxes withheld when I request a distribution?
you request a distribution, BUYandHOLD will withhold
money for taxes if you so choose.
IRA distributions are included in taxable income, and
the IRS is concerned that the proper income tax is paid
on these distributions. So, as of January 1, 1983, federal
tax withholding requirements applied to IRA distributions.
of this, all IRA custodians (BUYandHOLD for example)
must offer IRA holders the opportunity to have taxes
withheld at the time of distribution, similar to an
employer's withholding from a paycheck. This is a prepayment
of taxes at the time of the distribution. If, at the
time of tax filing, the individual has had more income
tax withheld than their liability requires, they will
receive a refund. If the individual's liability exceeds
the amount that they had withheld over the course of
the year, they will owe additional taxes at filing time.
choose your withholding option when you complete the
distribution form. If you choose taxes to be withheld,
BUYandHOLD will subtract the amount you request to be
withheld from the total amount of the payment you request.
Therefore, if you request $100 with 10% federal withholding,
you will receive a check for $90.
will send the money withheld to the government with
the appropriate reporting documentation.
IRA holder will see the money withheld on the Tax Form
1099R that they will receive at the beginning of February,
which is to be attached to their tax return.