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How do I do that with monies withdrawn from my IRA?

I’m not sure I understand your question. Are you asking about the tax penalties on early withdraw from an IRA before the age of 59 ½?

If you withdraw money from your traditional IRA before age 59 ½ you are subject to a 10% penalty in addition to federal and or state income tax or even local income taxes depending on where you live unless certain circumstances apply including but not necessarily limited to a permanent disability, death (there is no penalty to your heirs in that case), non-reimbursed medical expenses, the first time purchase of a home, some higher education costs for you, your spouse or children or medical insurance premiums if you are unemployed. The amount of federal tax withheld along with other considerations, will depend on your tax bracket. The rules for a Roth IRA are a bit different but I am not that familiar with them.

There is also a similar penalty for early withdraw from a 401K. When I left my last job I took a direct distribution from my 401K rather than rolling it over because it wasn’t that much money and even though I paid a 10% penalty and paid federal income tax on it, at the time I had nearly a month between my last paycheck from my previous employer and the 1st from my new employer and still had bills to pay so while not the advisable move in most cases, in my situation it was a necessity.

My expertise (such as it is : ), ) is in payroll and payroll tax compliance and general HR and DOL compliance and not so much in public accounting or in personal finance, investments and taxation. If you have questions about withdrawing money from your IRA, you should really consult with a certified investment advisor or a CPA.

If you are asking about how to adjust your withholding or estimated taxes to accommodate for an early IRA withdrawal, again this would depend on a whole lot of factors regarding your personal tax situation.

I sometimes have employee’s come to me and ask me for advice in completing their form W-4 – “how many allowances should I claim?”, “should I claim married or married but withhold at the higher single rate?” and unfortunately I can’t and won’t give them such advice because 1) I am not a CPA and not a personal tax preparer (although I did work with a CPA and attorney some years ago and assisted in preparing both personal and business tax returns, I didn’t sign them and my work was always reviewed and I don’t keep up with all the tax laws other than payroll withholding), 2) am not being paid to provide such personal services nor am I or my company indemnified by any sort of professional liability insurance should I give “bad” tax or investment advice to an employee and 3) unless I had access to all the employee’s (and their spouse’s if filing jointly) current personal financial information and probably at least the last 3 years worth of tax returns, W-2, 1099’s, mortgage interest statements, investment income statements, etc., based solely on the paychecks I process for this employee, their marital status and number of dependents, I can only guess at their overall tax situation.

The only thing I will tell an employee is that the fewer allowances you claim on your W-4, the more will be withheld in federal income tax, the more allowances you claim, the less will be withheld. If you owed money at the end of last year and don’t anticipate any changes to your financial situation this year, you “might” consider lowering your allowances to have more withheld, if you got a big refund, the opposite would apply. I point them to the resources in my previous post or advise them if they have complex tax situations or they are uncomfortable with figuring it out for themselves, they should really go to a reputable tax preparer or CPA.