[Bandit15]

I'm leaving the firm with 140m in my 401k plan. I want to move the funds into another 401k plan or IRA. I plan on buying a house soon, and would need to borrow from the plan.
What will give me the most flexibilities as far as penalties and restrictions goes. Is it possible to move my funds to a plan or IRA that allows withdrawals, then paying back the loan with interest? I'm going to need the funds regardless, it has to be done, so I'm just trying to minimize the tax and penalties associated with doing this. After leaving the firm I'm currently with, I will be out of a job for about 6 months. Like I said, I have to withdraw those funds, what's the best way? Thanks

[ebaines]

There are no provisions that allow you to borrow from an IRA, like you can form your 401(k). But since you are leaving the company, you probably can't borrow from your 401(k) either - check your plan documentation or ask your administrator about this, but I believe the borrowing feature of a 401(k) is only for active employees.

Which means the only way to get the money is to withdraw it. Unless you qualify for a hardship case, you will owe incomes taxes plus 10% penalty on whatever you withdraw prior to age 59-1/2. The penalties and taxes are the same regardless of whether you withdraw the money directly from the 401(k), or transfer it to a roll-over IRA and subsequently withdraw the money from there.