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Asked 7/24/2008
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Can you take money from 401k to pay for daughters college tuition My daughter owes $1800.00 for college tuition. She was not able to come up with all of it from her summer job.
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Answer 1/1 - Submitted 7/30/2008
Most employers allow a withdrawal from their 401K's for hardship and for loan purposes, in which the employee has to pay the loan back with interest directly into their account. If the loan goes into default ( late payment ) the employer files the remainder of the loan as an early withdrawal of pension plans and is subject to penalities and tax withholdings. He could also just withdraw the amount plus taxes and withholdings and claim it on his taxes at the end of the year. Have him to check with his human resources administrator for details of information.
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