I am changing jobs and will roll over my 401k to an IRA of my choosing. Since I will have access to this money, knowing there are penalties, does it make sense to wipe out my 40,000 of credit card debt. I still will have a significant amount left. I am under 40 years old.

You'll have to withdraw about $70K from your 401(k) in order to have anough to pay off your $40K debt. Figure 10% for early withdrawal penallty, 25% for federal taxes (this $70K gets added to your other incomne so it may put you in a higher tax bracket than your used to, and 25% may not be correct for your particular situation), plus whatever your state/local income tax on $70K would be - another 5%? Total of around 40% gone. Plus you've sold out at what is probably a low point in the value of your account - not the best time to be cashing in if you don't have to.