Internal Revenue Service United States Department of the Treasury
Level Basic Advanced Military International

Adjustments to Income

Penalties for Early Withdrawal

Penalty on Early Withdrawal of Savings

Case Study

Trudy has one Form W-2 and one Form 1099-INT and no other income. Her Form 1099-INT shows both interest income and an early withdrawal penalty. Trudy does not pay alimony, and she did not make a contribution to a traditional IRA.

Trudy can claim the adjustment for the penalty on early withdrawal of savings on Form 1040.