<<Withholding rate on distributions (even early ones subject to the 10% penalty) is 20% unless you designate another higher rate. Generally, you have to elect a higher withholding rate if you want it and you have to elect to have state taxes withheld. Otherwise, only 20% federal is withheld.>>Correct.But the amount withheld from the distribution will have NO BEARING on the actual tax and penalties that will be due on the distribution. Don't be fooled that the worst that will happen is a 20% hit. Nothing could be farther from the truth. TMF TaxesRoy
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