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The "key here" is the "taxable character" of the accounts:

If it's all in some sort of "tax preference" environment....there is no "taxable consequence" at all. Until you affect a directed"taxable distribution" to yourself (under the terms of the plan docs.) of the remaining balances that is....
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My other stock was Williams Communications, and they declared Chapter 11 in April. I had a ton of it in a 401k as well as a ton of WorldCom in a 401k (in addition to what I have been talking about here).

I'm sure glad I diversified between Telecomm and Energy. Oh wait, that's a loss too.


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KBM: (disclosure: heavily diversifed (telecom, energy, drugs, financials, chips, tech) - taxable accounts - but suffering from same similar losses - Lions, Tigers, and Bears, oh my)
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