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Hardship Withdrawals may be taken from your 401(k) Plan account for the following reasons:
After taking a Hardship Withdrawal, you will be suspended from making contributions to the 401(k) Plan for six months, and lose all employer matching contributions for this period.
Hardship withdrawals are limited to contributions only. If you take a Hardship Withdrawal, the amount will be subject to federal, state, and local income taxes. A 10% early withdrawal penalty may also apply to 401(k) withdrawals.
Unforeseeable Emergency Withdrawals
Unforeseeable Emergency Withdrawals can be taken from your 457 Plan account for certain extreme financial emergencies that are caused by circumstances beyond the control of the participant.
You must first exhaust all other loan and withdrawal possibilities before requesting an Unforeseeable Emergency Withdrawal. After taking an Unforeseeable Emergency Withdrawal, you will be suspended from making contributions to the 457 Plan for six months, and lose all employer matching contributions for this period.
If you take an Unforeseeable Emergency Withdrawal, the amount will be subject to federal, state, and local income taxes.
Participants who have made rollover contributions may take a distribution of eligible monies from their 401(k) or 457 rollover contribution accounts (excluding plan-to-plan transfer assets). However, if you are under 59½ and take a withdrawal from your 401(k), IRS early withdrawal penalties may apply unless you are rolling over the assets to another qualifying tax-deferred plan.
Age 59½ Withdrawals
Participants over age 59½ who are still actively employed may take a distribution from their 401(k) accounts. Before taking a distribution, you should consider your decision carefully. Such distributions are made without a 10 percent penalty, but are taxable as ordinary income unless being rolled over. 20 percent will be automatically withheld from your distribution for Federal tax purposes. Due to US Department of Labor regulations, this type of in-service distribution is not available in the 457 Plan.
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