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New Member
posted Jun 14, 2020 5:01:57 PM

My husband made an early withdrawal on his 401K when he was laid off suddenly so we could pay our rent, etc because he is the main breadwinner, a qualifying hardship?

0 2 550
2 Replies
Level 15
Jun 14, 2020 5:17:11 PM

The distribution will be taxed however the 10% penalty should be waived if you qualify : 

 

https://www.irs.gov/newsroom/coronavirus-related-relief-for-retirement-plans-and-iras-questions-and-answers

Level 15
Jun 14, 2020 5:33:31 PM

General "hardship" is not an exception the the 10% early-distribution penalty.  To avoid the penalty he would have to qualify for one of the specific exceptions listed in the reference provided by Critter.