Vanessa A
Expert Alumni

Retirement tax questions

There is not an exception to the underpayment penalty for hardship withdraws in general.  However, for 2024, there is a $1,000 Emergency personal expenses distribution that can be exempt from the early distribution penalty.  With a 401k, there is not an exception for education.  

 

Any withdrawals you made in 2023 would need to be reported on your 2023 return. Those would not be eligible for the $1,000 emergency personal expenses. And in 2024, the withdrawals you made, should be included on your 2024 return.

 

Retirement topics - Exceptions to tax on early distributions

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