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Author: joemo33 Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: of 121061  
Subject: Re: Tapping IRA to get MBA scenerio Date: 7/20/1998 12:31 AM
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Roy,

A couple of clafications to my question.

On your point "...couldn't move your 401k money until you left employment", you are correct but the $500K is in my PREVIOUS employer's 401K. I left it in there when I switched jobs. I can now roll it over any time I wish (with a weeks notice).

Also, both my previous and my present employers are Texas based (not that that seems to help if I withdraw the money while I'm a Mass. or Ca. resident... bit I feel like it should count for something :-)).

I guess a follow up question might be, is there any way to maintain my Texas state residency while I'm a full time student in Ca. or Mass.? Can I do it if I do not sell my house - or maintain some other type of permanant address in Texas (like George Bush did when he was in the White House)?

What if I rent out "part" of my house while I'm at school... does that change things?

I guess that I'm assuming that if I can maintain Tx. residency, and make IRA withdrawls to pay for the MBA and our living expenses, I won't have to pay Ca. or Mass. income taxes on the IRA distributions. What do you think?

Any idea on the timing of "residency"? I mean, lets say I start school on Sept. 20. I still own the house in Tx. on Sept 2 and make the IRA withdrawl on the 2nd. Then, Ca. or Mass should not have a claim to it then, right?

Also, thanks for the advice on looking for other ways to finance this endeavor. I'm trying to figure out if I can just hit the IRA for the education expenses and use the house equity (if we sell it) for the other living expenses. BTW, any idea how much of the "room and board" of a family of 4 I can consider "education expenses"? Heck, any idea where I can find a tax expert that can help me sort through all this?

Thanks.
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