How to Withdraw From a SEP IRA
- 1). Complete the required SEP IRA withdrawal form for the financial institution that holds your SEP IRA. The forms are slightly different from company to company. However, you will always be required to submit your identifying information, including your Social Security number.
- 2). Report the amount of the withdrawal as a taxable IRA withdrawal. If you use form 1040A to file your taxes, the withdrawal is reported on line 11b. If you use form 1040, the withdrawal is reported on line 15b. This amount will be added to your taxable income. If you are at least 59 1/2 years old when you take the withdrawal, you are finished.
- 3). Complete form 5329 to determine how much of a penalty you have to pay if you took the withdrawal before you reached age 59 1/2. As of 2010, the penalty is 10 percent of the amount of the withdrawal. This penalty is on top of any income taxes that you owe on the withdrawal and is reported on line 58 of form 1040.
Source...