Additional Tax on Qualified Plans (IRA)
U S Government seized client’s IRA (this was not the IRS) as payment on a federal court judgement client is 58 is there an exception to the 10% penalty similar to IRS levy of a qualified plan?
Any help is appreciated.
Michael
Permalink Submitted by Alan - IRA critic on Sat, 2014-10-11 22:50
The 72t exception relates to levies from failure to pay taxes under Sec 6331, so while it is usually levied by the IRS, it may be possible that another govt entity could levy an IRA and the exception might apply. Would have to do more research to determine if the exception would extend to that. Was the federal court judgement for failure to pay a tax? There is no other exception that applies to levies but client may be able to apply any of the other usual penalty exceptions that may cover part of the distribution. If a tax is involved in this case, please advise.
Permalink Submitted by Michael J Robertson on Sun, 2014-10-12 23:07
This was not income tax.Based on my review no other exception applies and the client is 58 just a bit short.Thanks appreciate your information.Michael