I'm wondering what the penalties are for withdrawing from a 401k early? :( :confused:

You pay normal income taxes (federal, state and local, if applicable) at your marginal tax rate (that is the tax rate on the last dollar you earn in the year).

PLUS

You pay a 10% Early Withdrawal Penalty which CANNOT be mitigated. In other words, if you had credits and deductions that completely offset all taxes owed, you would STILL have to pay the 10% penalty.

BOTTOM LINE: The tax consequences of withdrawing early from your 401K are PRETTY STEEP (it approaches 50% of what is withdrawn). DO NOT DO IT unless you absolutely have to!