Taxpayer asks:
is a person suppose to take his 401 k statement with him when he gets his taxes done! even though im not taking anything out of it as a penalty and i dont plan on it! sure the 401 k plan is another income but im not taking anything out of it until i retire
Taxgirl says:
You’re right that you don’t pay tax on your 401(k) plan until you take a distribution. It’s likely that your tax preparer just wants to verify that it is a 401(k) plan (as opposed to another type of retirement plan); that you didn’t take any distributions; and that you didn’t have any transactions that might be a deemed distribution (such as a non-admin rollover or certain loans).
My advice is to take it with, just in case. I can tell you that in all of my years of practice, I’ve never seen a tax preparer who was upset that a client brought too much info (and trust me, I’ve seen folks bring in Samsonites full of statements!) but I have seen tax preparers send clients home for not having the right info.
For an idea of what might be handy to bring with you to have your taxes prepared, click here.
Before you go: be sure to read my disclaimer. Remember, I’m a lawyer and we love disclaimers.
If you have a question, here’s how to Ask The Taxgirl.
