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-   -   Closing a 401k account (https://www.askmehelpdesk.com/showthread.php?t=41415)

  • Nov 7, 2006, 04:13 PM
    Homie
    Closing a 401k account
    HI. I'm on a Leave of Absence from my place of employment. I need money and the only source I have is my 401k... I took a loan out earlier this year, from the 401k, not knowing I could only have one loan out at a time. So now I feel my only option is to close the account and take whatever is leftover after taxes... Can I do that? Do I need the companies permission? Thank you in advance for any help
  • Nov 13, 2006, 12:47 PM
    posheak
    No its yours, you'll just take the big hit 10% penalty and its taxable income when you take it out.
  • Nov 13, 2006, 01:03 PM
    ScottGem
    If you can temporarily borrow enough to pay off the existing loan, you can then take a larger loan to pay off the temp loan.

    Taking an in service withdrawal from a 401K is a very last resort. The penalites and tax consequences are hefty.

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