Early withdrawls from 401K

Forum|Forum|4 years ago
March 31, 2022
3 replies
12 views

I need to be educated on something.

In 2021 if someone withdrew money from their 401K because of a hardship basis is that withdrawl subject to the 10 percent penalty?

ProSeries Basic

This topic has been closed for replies.

R

rcooley25Author

Level 7

That was a dum question that I ask.

I did some research on my own thru other sources and got the answer that I needed so disregard my earlier post.

sjrcpa

Level 15

How about posting the answer for the next person that wants to know?

The more I know the more I don’t know.

Just-Lisa-Now-

Intuit Community Champion

They let you take the withdrawal due to hardship, but the tax and penalty you pay (assuming its an early withdrawal) creates another hardship. Terribly expensive place to get money from.

♪♫•*¨*•.¸¸♥Lisa♥¸¸.•*¨*•♫♪

qbteachmt

Level 15

For reference:

401(k) or "qualified employer" plans have different rules than IRA (individual and self-employed) accounts.

The plan and plan administrator control whether hardship withdrawals and loans are allowed.

401(k) also has a "55 year old" provision. And Roth 401(k) has RMD requirements.

The plan provisions don't control the IRS. The IRS still only accepts specific provisions for elimination of penalties.

I like this table for reference:

https://www.irs.gov/retirement-plans/plan-participant-employee/retirement-topics-tax-on-early-distributions

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