topic Re: 401k in Home loans

401k

Mht1939 — Thu, 06 Aug 2020 17:28:58 GMT

Making a withdrawal from the 401k as a down payment will I be taxed on the amount I withdraw

Re: 401k

VolvoGirl — Thu, 06 Aug 2020 17:34:59 GMT

Yes. A 401K withdrawal is 100% taxable unless it's in a ROTH 401K. And there is a 10% Early Withdrawal Penalty if you are under 59 1/2. But the penalty might be suspended for 2020 due to the Covid-19. Can you take a loan from it instead of a withdrawal? You don't report loans.

Re: 401k

Mht1939 — Thu, 06 Aug 2020 17:40:39 GMT

My husband is 62, has a rollover 401k, will make a withdrawal of 60,000 in California. Does he take taxes right off the top or when we file next year

Re: 401k

VolvoGirl — Thu, 06 Aug 2020 18:10:36 GMT

They will take out tax withholding on the withdrawal. That's just like withholding from your paychecks. You will get a 1099R at the end of the year to enter into your tax return with your other income to figure out the total tax (and it may put you into a higher tax bracket) and then the withholding is subtracted from the total tax to figure your refund or tax due.