Is money from a 401k withdrawl counted as income on the 1040?

When I quit my last job, I elected to have my 401k funds withdrawn and distributed to me. There was only a couple of thousand so I didn't want to deal with the hassle of rolling it over, plus it was enough to pay off my daughters braces and get a discount that was more than the IRS penalty.

Anyhow, I recieved a form from my 401k provider that said that the distribution amount was $2180.00 and the Federal Tax was $545.00. First does this money get counted as income and have to be reported? I assume so, so do I add the $2180.00 to my Wages in the 1040 or does it get entered somewhere else?

Thanks a lot for any help with this!!

Yes, it's taxable.

Put the amount of the gross distribution on lines 16a and 16b on your Form 1040 return.

The 10% penalty goes on line 60. If you're claiming an exception to the penalty, attach Form 5329. If you're not claiming one of the exceptions, Form 5329 isn't requried.

Add the amount withheld to the W-2 withholdings on line 64.

You're quite welcome! TFTP Report It

It is income to you taxed at ordinary rates plus a 10% penalty.

The 401k $2,180 is income to you for 2007. You enter it on line 16b of form 1040. You must also do a Form 5329 and pay a penalty (10%) for the withdrawal. The tax withheld ( $545 ) must be added to line 64 of the Form 1040.

It does get reported, but not on the wages line.
1. The $2180 is reported on the pensions and annuities line of the 1040.
2. The $545 is the tax withheld, not the actual tax. The $545 is reported on the same line as other withholdings, such as those shown on the W-2.
3. In addition to the regular income tax, you also pay a $218 (in your case) penalty for premature distribution without rollover.

Yes, it has to be reported, but not on the wages line. The withdrawn amount of $2180 is reported on the pension line of your tax return, the 10% penalty of $218 is reported on the "additional tax on IRA's, other qualifying retirement plans, etc" line, and the $545 withheld is included in the "federal income tax withheld" line.