I have recently received my 401k from a previous employer which I in turn opened an IRA with my new employer. IRA was for $1700.00. If I cash it out how much am I looking at in penalties and what am I looking at during tax time?

You opened an IRA with your new employer? That doesn't sound right. Don't you mean you transferred your old 401(k) to a new 401(k) with your new employer? Or do you mean you rolled your old 401(k) to a new rollover IRA with an investment company (not with your new employer)?

If you cash out your IRA you will pay ordinary income tax on the withdrawal plus a 10% early withdrawal penalty - assuming that you are under 59-1/2 years of age and the withdrawal does not qualify for one of the exceptions to the penalty (i.e. first home purchase, higher education expenses, unreimbursed medical expenses in excess of 7.5% of income).