[bbicknel]

1) I owe Federal back taxes, State back taxes, and local real estate (county taxes) and am late on my house payments. Can I take out 401k money without paying the additional 10% tax for early withdrawl?

2) Also, a few years ago, I lost my job and my 401k automatically rolled into a withdrawl to pay the loans I had taken against some of the money. I filed my taxes and I was later adjusted to pay the 10% tax. Since I had no job, could this also be hardship?

My wife is on social security and is totally disabled also.

[ebaines]

No - sorry - being in debt or losing your job does not eliminate the requirement to pay the 10% penalty for an early withdrawal. The exceptions to having to pay the 10% penalty are for early withdrawals that are:

1. Made as part of a series of substantially equal periodic payments (made at least annually) for your life (or life expectancy) or the joint lives (or joint life expectancies) of you and your designated beneficiary (if from a qualified retirement plan, the payments must begin after separation from service) - this is known as a section 72(t) withdrawal.

2- Made because you are totally and permanently disabled.

3- Made on or after the death of the plan participant or contract holder.

4- From a qualified retirement plan (other than an IRA) after your separation from service in or after the year you reached age 55.

5- From a qualified retirement plan (other than an IRA) to an alternate payee under a qualified domestic relations order.

6- From a qualified retirement plan to the extent you have deductible medical expenses (medical expenses that exceed 7.5% of your adjusted gross income), whether you itemize your deductions for the year.

7- From an employer plan under a written election that provides a specific schedule for distribution of your entire interest if, as of March 1, 1986, you had separated from service and had begun receiving payments under the election.

8- From an employee stock ownership plan for dividends on employer securities held by the plan.

9- From a qualified retirement plan due to an IRS levy of the plan.

You do not appear to met any of these exceptions.