Does anyone know what the penalty is for an early with draw of a 4000 dollar 3 month cd?

Question

Does anyone know what the penalty is for an early with draw of a 4000 dollar 3 month cd?

Answer 1

The penalty varies from one financial institution to the next.  You should contact the particular financial institution to find out.

j

Answer 2

The government charges 10% early withdrawal fee on anything early. The bank will also charge a fee, but their rates are always different.

I just did an early withdrawal and the bank charged a $75 fee, plus $20 to transfer funds to my account. Each one is different. You have to call them and find out the specifics.

The 10% does not have to be paid up front. You do that when you figure your taxes at the end of the year. You have to figure in the profit amount you made off of the cd. Take the profit amount and you pay 12% tax on it at the end of the year. SOme banks insist that you pay taxes up front, but most will just send you a 1099 at the end of the year.

Call the bank and get the up front fees for withdrawal and figure the rest out at the end of the year. Otherwise you could get double charged for taxes.