Suppose I am leaving USA for good in 2007, but decide to leave the money in my 401k account, at age 45, with $10,000 in the account. I continue to work in my home country after that.

If I want to take an early withdrawal of all $10,000 in 2012, at age 50. Also, since I am already out of USA at that time, do I have to pay taxes on the income from my home country? What will be the tax rate that withdrawal be taxed at?

Thank you.

Yes, you would have to pay taxes even though you are already in your home country.

The 401K custodian will withhold AT LEAST 20% for taxes, and may withhold more due to you being outside of the U.S. to ensure you file a non-resident alien tax return to account for the early distribution.

Depending on the size of the distribution, you would pay at least 25% (10% Early Withdrawal Penalty, 10% federal taxes, 5% state taxes), though 35% is more likely.