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Tidybuoy Tidybuoy is offline
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Join Date: Jun 2003
Location: Fresno, CA
Posts: 7,863
Early Withdrawal on 401k - 10% Penalty

I am aware of the 10% penalty for early withdrawal but I had an emergency situation this year and withdrew $12,000 from my 401k - I'm 57.

In order to do an early withdrawal (at least on my plan), you have to demonstrate a hardship. I was able to do this because my dad has cancer and he has been put on a very expensive experimental medicine that is $121 per pill and has to take 4 per day. This is not covered by insurance (or at least there is a cap on what is covered). My siblings and I are chipping in to pay for this medicine which adds up to $15k per month. Fortunately, my sister who is an oncologist , got my dad hooked up with a charity that helps pay for some of this medication. Big Pharma should be ashamed but that is another thread!

So, I was able to prove the hardship and take out from the 401k. I also had $3k held for taxes. Now that I am doing my taxes, I don't seem to see anywhere (on TurboTax) where I do anything about the hardship. There is a box for "special" and if I check that, my taxes reduce by approximately the 10% but there is absolutely no definition of what "special" means and nothing listed on my 1099.

Anyone with knowledge on this subject?

Also, I do not claim my parents on my taxes in case that means anything.

Thanks
Old 02-10-2019, 04:26 PM
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