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8 answers

Minus 20 percent right off the top for federal taxes. (Approx. $9,950) I am not sure if you have penalties. (if you are retired, then you should not have penalties). The taxes will be adjusted accordingly when you file next April.

If you just retired and wait until Jan 1, 2007, it will not be counted as income for this year. Otherwise it will include the income you earned this year which may raise your tax bracket for this year (and pay higher taxes)

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Thanks

2006-11-03 18:42:42 · answer #1 · answered by zambranoray 3 · 0 0

I think it would be more than 20% tax. i believe distribution from your 401k is counted as income. So IRS will tack that on top of your current salary. This extra money will probably move you to a higher tax bracket. You will pay federal rate + state rate + 10% penalty. I would say you are looking at a minimum of 40%.

2006-11-03 20:42:16 · answer #2 · answered by Vincent C 2 · 0 0

Roll it over to a IRA. in case you cash out the 401k, you will ought to pay a ten% penalty for early withdrawal plus earnings taxes. assume 30% to 40% withholding to cover those. you will possibly be able to get a number of that lower back once you document your tax return, reckoning on your incredibly tax criminal accountability.

2016-11-27 02:19:18 · answer #3 · answered by kittredge 3 · 0 0

Unless you're really in need of money, it is best to roll it over into another investment. If you do decide to pull your cash, you will be paying taxes on your money. Depending on which tax bracket your in will determine the amount you will pay. Generally anywhere between 23% up to 37%.

2006-11-03 18:53:23 · answer #4 · answered by Henry G 1 · 0 0

All of it less 20% for federal taxes. You will then pay another 10% when you file as a penalty.

Unless your in serious financial need, roll it over you be happy you did in the long run.

2006-11-03 18:39:49 · answer #5 · answered by jv1104 3 · 1 0

This is about the worst financial decision that you could make. Roll it over into another account and leave it for retirement. Find another source of income, if you need cash.

2006-11-04 00:32:56 · answer #6 · answered by mightymite1957 7 · 0 0

You need to check with an accountant, or the HR department. You will be penalized, I think 10% for early withdrawal, and I believe you will have to pay income taxes on the amount.

2006-11-03 18:41:14 · answer #7 · answered by LmL 2 · 0 0

please don't take this the wrong way, but cashing out on your 401k is by far the dumbest thing you can do. If you need money, get a loan, or a second job, but please....do not cash out your 401k.

2006-11-03 18:49:20 · answer #8 · answered by demonic angel 2 · 0 0

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