Withdraw Funds from Solo 401K to Pay for Daughters College

QUESTION: Our daughter is attending Georgetown Law in DC. Please confirm we can withdraw funds from the remaining balance in our Solo 401K to pay for her tuition, room, & board.

ANSWER: Unlike an IRA which allows for early distributions if the proceeds are used to pay for and thus escape the 10% early distribution penalty, the same is not true for distributions made from a 401k including a solo 401k where the withdrawal proceeds are used to pay education expenses.

Please see following links for more information on this.

http://www.mysolo401k.net/solo-401k-distribution-education-expenses/

http://www.mysolo401k.net/exceptions-to-early-solo-401k-ira-distribution-tax-penalties/