Free Republic
Browse · Search
Bloggers & Personal
Topics · Post Article

To: NYACC1978

Sounds like you’re looking to take a hardship from a former employer’s 401k,no? If this is the case, you can’t since you’ve severed service. You must “roll” these assets into your own IRA and take the cash out as a distribution which MAY be tax exempt based on hardship: medical, disability, etc. It will, regardless, count as income for the tax year.

If you’re under 591/2 you’ll also be penalized 10% of the amount for premature w/d from a qualified plan.


17 posted on 12/29/2010 8:46:51 AM PST by Dansong
[ Post Reply | Private Reply | To 1 | View Replies ]


To: Dansong

“a distribution which MAY be tax exempt based on hardship”

No, it MAY be PENALTY-exempt. In other words, if it’s a qualifying hardship, you won’t have to pay the 10% early withdrawal penalty. You’d still have to pay income taxes.

The IRS will get their money.


19 posted on 12/29/2010 8:54:05 AM PST by Choose Ye This Day ("As government expands, liberty contracts." -- Ronald Reagan)
[ Post Reply | Private Reply | To 17 | View Replies ]

Free Republic
Browse · Search
Bloggers & Personal
Topics · Post Article


FreeRepublic, LLC, PO BOX 9771, FRESNO, CA 93794
FreeRepublic.com is powered by software copyright 2000-2008 John Robinson