Would it make sense to empty out one’s 401K to pay down debt, if this thing gets passed, or before?
I know most people say that’s a no-no, but if the money’s going to be stolen anyway...
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Plenty of time to act before anything like this could ever become law.
That said, how old are you? You will take a 10% hit if you are younger than 59.5 years (on top of income tax).
How much debt do you have and what kind? Paying off a mortgage might make sense if you could pay it all. Then you'd have extra cash every month, but where would you put it?
Does your debt exceed your 401k/IRA holdings?
If you decide to do it get it done this year. Next year the taxes on all income (including unearned income) will rise.