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The IRS requires 20% withholding on all qualified plan distributions eligible for rollover to an IRA or another qualified plan. You will report the distribution as ordinary income on your personal tax return. Depending on your personal tax bracket, you may be required to pay additional taxes on the distribution or you may be entitled to a refund. If the additional amount of tax due is substantial, you may be required to make estimated tax payments. You may also be required to pay state income taxes. You should consult your personal tax advisor before making decisions regarding your distribution.

Prior to 2020, you were required to start taking Required Minimum Distributions (RMDs) by April 1 of the year following the year in which you attained age 70 ½. That rule still applies if you attained age 70½ by the end of 2019. Once you are required to begin taking RMDs, you must continue. For 2020, the SECURE Act increased the age to begin RMDs to age 72. The same April 1st deadline applies. Thereafter, you must take RMDs annually on or before December 31. Note, two required distributions will be issued your first year if you wait until the period January 1 to April 1 to begin your RMDs. You may avoid two taxable distributions in the first year by taking your first withdrawal on or before December 31 of the year in which you attain age 72.
 
However, if you are still working, you are not required to begin RMDs from your employer sponsored plan until April 1 of the year following the year in which you terminate employment. This exception does not apply if you own more than 5% of the employer, nor does it apply to IRAs.

The annual deferral may not exceed the lesser of:

a. $22,500 for 2023;

b. the maximum deferral amount allowed under the terms of the plan; or

c. the amount that allows the plan to meet the required nondiscrimination tests.

In addition, if you attain age 50 or older by December 31, you may defer an additional $7,500 catch up contribution.

If a plan accepts rollover distributions from other qualified plans, it may also allow for employees to make a rollover contribution before they meet the plan's minimum age and service eligibility requirements. These employees would be considered 'limited participants' in the plan.

Yes, the additional 10% tax applies, with limited exceptions. Exceptions include distributions that are made to a participant after termination of employment after attainment of age 55, distributions that are attributable to an employee being disabled, and distributions that are made to cover deductible medical expenses.