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kiwifruit
Jan 12, 2007, 05:40 PM
I will be migrating to New Zealand and would like to withdraw my 401K following my resignation. Can anyone please help me to understand how much of the total funds will be taxed and at what rate? I am hearing that I will have to pay 10% upon withdrawal but how much will I have to pay to state and federal.

Appreciate it

CaptainForest
Jan 12, 2007, 08:18 PM
You will have to pay a 10% penalty.

On top of that, you will have to pay ordinary income taxes on the money you withdraw, which could push you into a higher tax bracket depending on what other income you have for the year.

AtlantaTaxExpert
Jan 13, 2007, 06:28 AM
Captain Forest has is quite right.

WHY withdraw the funds? You can manage the account from New Zealand via phoneand e-mail quite easily. If the 401K manager will not let you mainatin the account, roll it over to a rollover IRA into Fidelity and Charles Schwab. I know they will allow you to manage it from New Zealand.