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What are the consequences of taking a cash distribution?

April 26, 2017cash consequences distribution taking

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What are the consequences of taking a cash distribution?

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The IRS mandates 20% withholding on all cash distributions towards any taxes that may be owed. Depending on your individual tax bracket, you may owe taxes in addition to the 20% withheld. The amount is determined when you file your taxes. In addition, if you are under age 59 ½ you will incur a 10% IRS early withdrawal penalty.