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Stone Harbor
Returning Member

401K withdrawal separation from service

I left my previous employer at age 48, and have kept my 401K there with that employer.  Now at age 58, I am interested in understanding whether I can withdrawal any portion of that 401K without tax penalty.  Does the separation from service clause allow this withdrawal without penalty?  Or would I have had to have been 55 at the time of separation?  If it matters, my interest in withdrawing from that 401K is for college expenses for my two youngest children.  

2 Replies
Level 15

401K withdrawal separation from service

You had to be age 55 at time of separation from service, and higher education expenses do not qualify for a 10% penalty exception either.  However, you can roll the 401(k) into an IRA, and then take a distribution from that for that without penalty.  But income taxes will still be due. See:

Retirement Topics Tax on Early Distributions | Internal Revenue Service (

Stone Harbor
Returning Member

401K withdrawal separation from service

Thank you for that @SweetieJean 

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