I was wondering now that tax season is in full swing, if I could get a tax break on my 401k money that I cashed out. I was told at one time divorce could be used as a hardship. I have two dependants and I made $32,000 last year. Any information would be helpful. Thank you.

FunnyFace:

If the 401K was forced by the divorce as part of the settlement (under the exception for a Qualified Domestic Order), then you would not have to pay the 10% early withdrawal penalty.

However, you do have to count the 401K distribution as normal income and pay the normal income taxes.