Is there a place on the forms for early withdrawl that show the amount that the 401K will be cashed in for? I understand there will be a penalty for early withdrawl. How can I know what the amount is that it will be cashed in for? Please help! I am confused.:confused:

If you take an early withdrawal the plan administrator will automatically withhold 20% for income taxes. So the amount of the check you receive is 80% of the amount you withdraw. Example: if you withdraw $10K, the admin will send you a check for $8K. At the end of the year the admin will also send you a form 1099R that will report this withdrawal to both you and the IRS. You must include the amount shown on your 1040 when you file your taxes, and you must also include the 10% early withdrawal penalty amount that you owe to the IRS. In the example above, that means you have to come up with another $1000 to pay the IRS when you file your 2007 taxes. So while you may receive a check for $8K in this example, you should not spend any more than $7K or you will be short of funds come April.

If your plan provides for inservice withdrawals, generally you can specify the amount of the withdrawal. The plan provisions will limit the amount to no more than the vested balance, but may limit it further. So the only one who can answer your question is your plan administrator.

As noted, they are required to withhold 20% towards your tax liability. And you will have to pay 10% in addition to the taxes when you file your return.

Inservice withdrawals of a 401K should be a desparation move. Have you checked if the plan has a loan provision? The economic cost of withdrawing may be far worse than other alternatives.