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Retirement tax questions
That's not an exception.
While you may be allowed by your plan to take a hardship withdrawal, all 401k withdrawals are always subject to regular income tax, plus a 10% penalty for early withdrawal if you are under age 59-1/2.
There are a few exceptions to the 10% penalty but the only one that probably applies to you is you can exclude the penalty on up to $1000 per year for a personal financial emergency. If you withdrew more than $1000, you will owe the penalty on the rest. See the list of exceptions here.
When you enter the 1099-R for the withdrawal, you should be asked about exceptions you might qualify for.
‎January 27, 2025
3:01 PM