All Forum Posts by: Scotty Gifford

@Tom Makinen

I was referring to a regular 401k account..

And yes you can avoid the 10% penalty.

Not the income taxes. As the withdrawal will count as income, which will be on top of your regular income, which depends on your tax rate, Because it will count as income just like if you waited to take the money out after 59.5. No getting around paying the taxes.

You will need to live In a state with community property state, be marriage, and it Won't work on a IRA account.

On a Roth IRA you would be allowed to

Withdraw your nontaxable contributions to the account are distributed before the taxable earnings. If you don't withdraw more than the amount you contributed to the account you won't owe income tax on the distribution.

Early withdrawals from Roth 401(k)s are prorated between contributions and investment earnings, some portion

of the Roth 401(k) distribution is likely to be taxable.

@Brian Babbage

It is possible to avoid the 10% penalty, but it involves getting a 401k lawyer, being in the correct state, Texas is one of them.

Cost is around $4000 to get it done.

A 10٪ penalty on $100,000, is $10000, so there are some savings. If you have enough money you would like to take out.

Note you still have to pay income taxes on your money, but you have to do that even at 59.5 too. Sadly there is no avoiding that income taxes.

All the better reason to move that money into a taxes Advantage asset like real estate!

I know tons of people that have done it. Send me a personal message if you want to learn more and I can pass on the info..