Withdrawal from 401K
L1: Withdrawal from 401KWe took an early withdrawal in 2010 and now we will be dealing with the 10% penalty on our taxes due April 15 2011.My question is – Can we still structure and activate a plan that will help us avoid the 10% penalty?2011-02-21 23:00, By: Rates, IP: [126.96.36.199]
L2: Withdrawal from 401KPlaning happens before the event, not after. If you were over age 55 and you separated from service at or after age 55, there is no penalty. If not, you will owe the 10% penalty.2011-02-21 23:09, By: Gfw, IP: [188.8.131.52]
L3: Withdrawal from 401KIn other words :
1. How old were you on 12/31/2010 ?
2. Did you stopping working for your employer during 2010, either voluntarily or involuntarily ?2011-02-22 01:10, By: dlzallestaxes, IP: [184.108.40.206]
L4: Withdrawal from 401KIt does not change the basic answer, but we have had so many people describing an IRA as a 401k and vice versa, you need to be sure what type of an account this was because the penalty exceptions that might have existed for you are different. For example, the age 55 separation exception does NOT apply to IRA accounts. There are others that apply to IRAs but not to 401k accounts.2011-02-22 03:22, By: Alan S., IP: [220.127.116.11]