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    deknowlton's Avatar
    deknowlton Posts: 1, Reputation: 1
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    #1

    Jun 16, 2008, 02:26 AM
    Early 401k withdrawal
    If I take an early 401k withdrawal and have no reported income for the same year the withdrawal is taken, am I still penalized?

    Thanks!
    MukatA's Avatar
    MukatA Posts: 7,110, Reputation: 176
    Tax Expert
    		  
    #2

    Jun 16, 2008, 04:44 AM
    Yes, you pay 10% early withdrawal penalty.
    The withdrawal will be taxed as ordinary income. It is always good idea to withdraw (if you must) when you have no income or little income.
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