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Financial Planning / Foolish 401(k)s


Subject:  Re: 401k withdrawal question Date:  12/4/2012  9:33 PM
Author:  pauleckler Number:  24960 of 26179

In 401K plans, if you leave your employer after Jan 1 of the year in which you turn age 55, you may take distributions without paying the penalty. The distributions are taxed as ordinary income, but penalty free.

So if she turned 55 in 2011, her distributions should be free of penalty (but spreading them over several years might keep her in a lower income tax bracket).
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