[glaavin]

Hi, I used to work in NYC (on a H1-B visa) and have accumulated about $20000 in my company's 401K account but have since moved back to Canada (I'm a Canadian citizen). I have requested a withdrawal of the full amount and I just received a request to fill out the W8-BEN form by the Bank of NY (I guess they are the payment administrator on the 401K plan). I was wondering if I need to complete the form and send it back to them before they will issue my check? I do intend to be responsible for all the taxes, but I need the proceeds quite soon as it is for a down payment on a home. Does anyone know what the process is?

Thanks much

[LUNAGODDESS]

There is a high tax on your early withdrawal of any 401K account... any way fill out the necessary forms and it will take between 20 days and thirty days the most.. also please contact your account administer for any further information... each company is different... with different rules especially for out of country transfers...

[AtlantaTaxExpert]

I suggest you tranfer the money to an IRA, then withdraw the money from the IRA.

The reason for this is that withdrawing money from an IRA for a new home exempts you from the 10% early withdrawal penalty on up to $10,000 of the withdrawal. That's a $1,000 savings.

[javedahmad]

Foreign students on F-1 visias inquiring on social security and medicare tax refunds at the time of departing USA may find some useful information at http://www.istaxes.com/taxes/form-843.html

[vannavada]

Thoughtful insight into the issue and added to the savings a client can make!