Hey people of r/personalfinance, I just had a few questions on the ramifications of withdrawing money from an old employer's 401K.
First, I am aware that this is a last resort option. I am aware that this is heavily advised against. I am going through some extreme financial hardship and if I do not withdraw this $5,000 I will lose my home. I am 27 and I feel that I can rebuild this $5,000 rather quickly once I'm back on my feet. I do not qualify for a hardship withdrawal.
I know they say the tax peanelty is harsh and I will be taxed twice, once when the finances are pulled and once at tax time it will be taxed as income. There is a 10% fee from Fidelity for withdrawing, then the 10% federal tax and my state's income tax of 5%. Then it will be taxed as income, and I am in a low tax bracket (15%.) So I'm assuming of the $5,000 I may see $3,200- $3,500 of it if I'm lucky.
Basically I'm just writing this to ask, am I correct? Is there anything I'm missing or anything else I need to know? Will I need to retain some of the funds to pay come tax season? I don't have a "tax person" I can seek out, really. I'm used to doing my taxes with TurboTax. Any help is appreciated.
Submitted September 30, 2017 at 09:04AM by SB572336082 http://ift.tt/2x4VXab
