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Asked 10/20/2009
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401k and education If i use my 401k to pay for my daughters college expenses will I have to pay the 10% penalty |
Answer 1/1 - Submitted 10/20/2009
If you are under 59 1/2.. yes.. the only way around the penalty is being permanently disabled.. or if it used for medical bills that exceed a certain percentage of your income.
You can however most likely get tax credits for the cost of tuition.
The 401 (k) distribution will be coded as an early withdrawal subject to tax and penalty.
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