Hello Fools,

I am well aware of the pitfalls of withdrawing money from a 401(K) account i.e. 10% penalty and a tax hit.
What I need to find out is how exactly will the tax
be calculated. Is it flat 28% capital gains on the gains and my tax rate on the principal and when is the 10% penalty calculated, before or after the taxes?

i.e. if i withdraw 12,000$ from my 401(K) account is
the following calculation correct assuming 2000$ gains.

penalty : 1200$
capital gains : 2000*0.28=560
taxes on principal (i.e. 10,000$) : 10,000*0.30=3000

Hence I will get back 12,000-1200-560-3000=7240$

Is this calculation correct or am i missing something?

Regards

Nikhil Bhat