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

    Mar 19, 2008, 03:24 PM
    401K early withdraw
    I have lost my job and need to get all of my money out of my 401k plan. How much is the penalty and how much tax do I have to pay on my money which I withdraw. Which is about $40,000
    AtlantaTaxExpert's Avatar
    AtlantaTaxExpert Posts: 21,836, Reputation: 846
    Senior Tax Expert
    		  
    #2

    May 2, 2008, 11:15 AM
    FOUR WORDS: Do Not Do IT!

    Not only will you pay normal income taxes on the $40K, you will pay a 10% Early Withdrawal Penalty, which is $4,000 right off the top which CANNOT be offset by deductions, exemptions or credits,

    All in all, you can expect to lose about one-third of the $40K if you make the withdrawal.
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