If the client has large medical expenses and takes an early distribution for which he would normally be penalized, where in the Form 1099-R worksheet do I indicate that the early distribution was for medical expenses and eliminate the 10% penalty? Thanks for any help.
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Check out form 5329
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enter the amount of excess medical expenses (normally the amount that would be deductible on Schedule A = over 7.5% AGI) on form 5329, the penalty form
Once you have filed the 5329 with the medical exemption (05) what happens? If your retirement vendor has withheld the 10% already, how/when do you know if the exemption was approved?
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