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    Blue Ridge Lady's Avatar
    Blue Ridge Lady Posts: 1, Reputation: 1
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    #1

    Jan 31, 2009, 09:54 AM
    401(k) withdrawal taxes and penalty
    I lost my job in April '08 as a Mortgage Loan Officer and have had to survive on my 401(k). I altimately still had to file BK, Chapter 7 and am now losing my house. I'm trying to find if I can use hardship rules to waive the 10% penalty.
    AtlantaTaxExpert's Avatar
    AtlantaTaxExpert Posts: 21,836, Reputation: 846
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    #2

    Feb 2, 2009, 11:46 AM
    Negative. There are NO hardship withdrawal provisions from a 401K other than to pay for medical costs in excess of 7.5% of your Adjusted Gross Income.

    You will have to pay all state and federal income taxes due PLUS the 10% Early Withdrawal Penalty.
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