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You will not have to pay the 10% penalty on your 401(k) distribution. According to the IRS:
The 10% tax will not apply if distributions before age 59 ½ are made if "Made to a participant after separation from service if the separation occurred during or after the calendar year in which the participant reached age 55,"
The rules are different for your "Roth 404(k). Instead of a 10% penalty, you may have to include a portion of the distribution in gross income. According to the IRS:
A qualified distribution is generally a distribution that is made after a 5-taxable-year period of participation and is either:Still have questions?
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