What are the legal and tax considerations of using present 401k funds for investing in individual stocks? Most to my 401k money is in a S&P 500 fund. Expenses are cheap but the S&P is not doing anything to brag about.

Thank you

Almost all 401Ks have a limited choice of investment options. The plan admins choose what options are available. There are no legal or tax considerations at all for investing in any vehicle offered by the plan. And you rarely have control over the funds to invest in individual stocks. The only consideration is risk and return.

An IRA on the other hand, is usually self directed and you can invest it any way you want. The tax considerations come only when you withdraw.