Hi,

I have stayed in US for an year now and planning to move back to my home country. I have a deposit upto $5000 in my 401k account.

My question is:
Q: Is it good to withdraw the money before I leave US
or
Q: Good to withdraw the money after going to my home country?

I want to know how taxes will vary if I withdraw it when I am in US and when I do it from outside US.

Thanks in advance,
Regards,
Sreenivas

MukatA

When ever you withdraw, you will pay 10% early withdrawal penalty and must report this as income on the U.S. tax return.
It is better that you withdraw it when you are in the U.S. Plan administrator will withhold taxes from it.

If you withdraw when in India, you will also have to report this on India tax return.

ls_sreenivas

Thank you MukatA