Ira Rollover Hardship Withdrawal
June 10th, 2009
Question: IRA account?
Is it possible to set up a IRA account and rollover what I have in my 401k plan at my work, then withdraw the money. I need the money that is in my account, but I can’t withdraw early, can’t get hardship withdrawals or loans, trying to find a way to access it. Any advice???
Answer: You could quit your job – Then they would probably let you roll over the money into an IRA. Then you could withdraw it. – But if you do this (assuming your are under 59 and 1/2 years old) plan paying a 10% penalty to the IRS plus perhaps 2 and 1/2 percent to your state (laws vary from state to state) – plus you will pay pa income tax on the full amount withdrawn. – Overall you would probably lose about 1/2 the money to taxes and penalties and you would be out of work.
Some companies will allow loans from 401K plans, but apparently yours does not if I understand your question correctly. – You can’t take a loan from an IRA.
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