Pretax portion of account = 1 - nondeductible portion
Finally, use this as a multiplier to determine the amount of your withdrawal subject to a 10% penalty.
Penalty = (pretax portion) x (withdrawal amount) x (0.1)
For example, let's say that you withdraw $5,000 from your traditional IRA early. If your account is worth $50,000 and you've made $10,000 in nondeductible contributions, you can determine that the nondeductible portion is 20%, or 0.2. Subtracting from one gives a pre-tax portion of 80%, or 0.8. Finally, the penalty can be calculated using this multiplier as described in the preceding equation.
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