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    mother123's Avatar
    mother123 Posts: 3, Reputation: 1
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    #1

    Jul 15, 2009, 11:58 AM
    401 k early withdrawal
    If I take an early withdrawal from my 401k, how will I be penalized come tax season?
    ebaines's Avatar
    ebaines Posts: 12,131, Reputation: 1307
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    #2

    Jul 15, 2009, 12:49 PM

    You will pay (a) federal income tax, (b) state/local incoime tax (as appropriate for where you live), and (c) an early withdrawal penalty of 10%.

    If you need cash from your 401(k) and are still employed at the same company where your 401(k) is located, consider taking a loan from yhour account rather than a withdrawal - there are no taxes nor early withdrawal penalty when you take a loan. Of course, you have to be able to pay the loan back over time.
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