Wisconsin River Bank with location in Sauk City and Lodi. Wisconsin River Bank offers personal and business banking services.
Wisconsin River Bank has branch locations in Sauk City and Lodi, Wisconsin. Savings, checking, mortgages and home equity Loans. Wisconsin River Bank home page.Contact information for Wisconsin River Bank based in Sauk City and Lodi, Wisconsin.
Wisconsin River Bank serves the people and businesses of Sauk, Columbia and Dane Counties.

10% Withholding Vs. 10% "Penalty"
There is a Big Difference


The 10% assessment on premature retirement distributions is actually an additional tax rather than a penalty. Both individual retirement account (IRA) owners and IRA administrators are often confused about the federal income tax withholding and the additional tax because of the "10 percent" similarity.

The 10% withholding is a federal income tax withholding requirement that can be waived by an IRA owner when they take a distribution. The amount withheld is actually a prepayment on the account holder's federal income tax liability for the year. An individual must make an election as to the amount to be withheld. If no election is made by the IRA owner, the bank is required to withhold 10% of the total distribution for federal income tax purposes. An individual makes this withholding election by completing IRS form W-4P, Withholding Certificate, or a suitable substitute.

Unlike the federal income tax withholding, the additional 10% premature distribution tax is an IRA owner's responsibility and applies to traditional, Roth, Simplified Employee Pension (SEP) programs, and Savings Incentive Match Plan for Employees of Small Employers (SIMPLE) IRAs as well as Coverdell Education Savings Accounts. Generally this distribution applies to an individual who takes distributions of funds prior to age 59 1/2 and does not meet an exception to the additional tax.

Exceptions to the 10% premature distribution tax include:
  • distributions for first-time homebuyers;
  • certain higher education expenses;
  • health insurance premiums and medical expenses;
  • substantially equal periodic payments;
  • IRS levies; and
  • conversions, disability and death distributions.
An IRA owner and their tax advisor must determine whether this penalty (additional tax) applies. If the tax does indeed apply, the IRA owner will either report the additional tax directly on his/her federal tax return or on IRS Form 5239.

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Locally owned and managed.


Wisconsin River Bank Residential Mortages.

Wisconsin River Bank offers Personalized Personal Banking with a Community Touch.
 

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