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Level 2

Solved

401k Hardship Withdraw

Forum|Forum|5 months ago
February 18, 2026
2 replies
44 views

Hi and thanks in advance for your help. I took $20,000 out of my 401k in 2025 via the hardship withdraw. I know I owe an additional 10% penalty on this amount. With the new law allowing $1,000 withdraw without penalty, do I only owe the penalty on the remaining $19,000?

Best answer by Opus 17

Yes, you can claim an exception to the penalty for up to $1000 for a personal emergency expense. After entering the 1099-R for the withdrawal, Turbotax will ask about situations that might qualify for a reduced penalty and that is one of the choices.

Note that you can't claim the personal emergency exception more than once per 3 years, unless you either (a) repay the emergency distribution, or (b) make new contributions into the 401k that are more than the amount of the previous emergency withdrawal.

Answer

Level 15

Yes, you can claim an exception to the penalty for up to $1000 for a personal emergency expense. After entering the 1099-R for the withdrawal, Turbotax will ask about situations that might qualify for a reduced penalty and that is one of the choices.

Note that you can't claim the personal emergency exception more than once per 3 years, unless you either (a) repay the emergency distribution, or (b) make new contributions into the 401k that are more than the amount of the previous emergency withdrawal.

adidas33999Author

Level 2

Thank you!