Chinabloo Posted April 13, 2018 Posted April 13, 2018 I lost my job about a year ago. I could not take a hardship withdrawal because I was no longer with the company I was unable to pay large recent medical bills or rent due to the job loss so I cashed out my 401k (around $20k) to take care of those things The tax paperwork from my plan does not indicate a hardship withdrawal so I'm getting killed on taxes. Is there a way to show on my taxes that it was a hardship or can my plan provide corrected docs?
ETA Consulting LLC Posted April 13, 2018 Posted April 13, 2018 A "HARDSHIP" is only a means of receiving a distribution from the plan when one would not otherwise be available. ALL distributions are going to be taxable to you. Hardship doesn't impact the taxes; it only makes the distribution permissible when it otherwise would not have been. In your case, you didn't need a hardship because you were already eligible for a distribution; you had a severance of employment. Good Luck! Pam Shoup 1 CPC, QPA, QKA, TGPC, ERPA
John Feldt ERPA CPC QPA Posted April 13, 2018 Posted April 13, 2018 Have your tax preparer look at Form 5329 to see if you might be able to at least avoid the 10% excise tax, if applicable. edit: typo
Loves401(k) Posted April 13, 2018 Posted April 13, 2018 And you may be able to deduct some of the medical bills
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