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When you quit your hateful job 59 1/2 and start
living off your sizable 401k, you will be paying
taxes on the 401k disbursements. What gain
calculation methods are available for calculating
the tax liability in this case?

I hope the size of the 401k was a worthwhile trade for a job you hated. And don't forget that the majority of the money in the 401k is YOUR money that you choose to save for retirement. Very few companies offer 100% matching funds.


As far as taxation goes, it's pretty simple. You pay ordinary income tax on whatever you take out. There's no capital gains issues here.

UNLESS -- you chose to have your employer's securities distributed to you. Then you pay ordinary tax on a part of the value and then that becomes your basis for capital gains or losses when the stock is sold. Only your employer can provide that information - and they will at the time you take the distribution.

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