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I used a portion of an early 401K withdrawal to pay off my school loan, and to send my wife and son to school. Does it qualify for exemption for higher education?

I used a portion of my early withdrawal to pay off my college loan and to pay to send my wife and son to college this year.  Can any of this be used to reduce the early withdrawal penalty? 

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New Member

I used a portion of an early 401K withdrawal to pay off my school loan, and to send my wife and son to school. Does it qualify for exemption for higher education?

I'm afraid none of those payments are exceptions to the 10% penalty for premature distributions from a 401(k) plan.  The exception for qualified education expenses is only available for distributions from IRAs.   Please follow this link for more information.  https://www.irs.gov/retirement-plans/plan-participant-employee/retirement-topics-tax-on-early-distri...

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New Member

I used a portion of an early 401K withdrawal to pay off my school loan, and to send my wife and son to school. Does it qualify for exemption for higher education?

I'm afraid none of those payments are exceptions to the 10% penalty for premature distributions from a 401(k) plan.  The exception for qualified education expenses is only available for distributions from IRAs.   Please follow this link for more information.  https://www.irs.gov/retirement-plans/plan-participant-employee/retirement-topics-tax-on-early-distri...

View solution in original post