W
worried ga
Guest
I have a huge problem and need advice. In opening my current investment account I transferred funds from a previous firm, which was an employer funded SEP Account/without salary reduction. I've since made several withdrawals in 2001 (early-I'm not of retirement age), in times of serious personal debt. I resigned my job and am now working in a home based business (S-Corp). The last withdrawal, I was told by an Account Rep. that it was not a SEP account and had never been transferred as such. I was ignorant to the whole thing, with little experience in recognizing the discrepancy upon receiving verification of the account opening. I've taken considerable losses on my investments, so as a whole, my account was not in the positive from the initial moneys received into the account. (which I have since sold stock to withdraw money). I know I will be taxed heavily, but on what portions considering the losses and the fact that the account was never really a SEP (would I be liable for the 10% penalty, etc.) Will I be able to use the formula: Amount rec. x Cost of Account/Balance of account = tax free amount, or should this even be treated as a SEP distribution. Obviously, I was never taxed on these withdrawals. I've received my W-2 from my previous employer. The "retirement plan" box is checked. That's it. No amounts for the year were included. I probably won't receive anything from the brokerage account other than maybe a 1099 composite (but I doubt it). Any knowledge you can provide will be extremely appreciated. I fear the IRS until I can resolve some of my questions. Do I need a lawyer, or can I do this on my own?