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    ceez03's Avatar
    ceez03 Posts: 1, Reputation: 1
    New Member
    		  
    #1

    Jul 2, 2008, 10:09 AM
    How does it work out if I want withdraw my 401K balance of $5k? What are the penalties and how does the taxing on that work out?
    ScottGem's Avatar
    ScottGem Posts: 64,966, Reputation: 6056
    Computer Expert and Renaissance Man
    		  
    #2

    Jul 2, 2008, 12:17 PM
    First its not a good idea to piggyback your question on someone else's. This can lead to confusion. You should start a new thread. So I've moved your question to its own thread.

    Not all plans permit an inservice withdrawal. If your plan allows it they will generate withhold 20% towards your federal tax liability. IN addition you will be required to pay 10% as a penalty. The amount of your withdrawal is added to your total taxable income to dtermine actual liability.

    Why not take a loan against your 401K instead.
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