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Is it possible to withdraw money from my 401K (Roth and regular) and deposit them in the respective account (Roth IRA and regular IRA) without any penalty with the new COVID-19 rules? I believe that the law allows for up to 100K withdrawals. Is there something I should watch out for?

If you are no longer working for the company, or the company's plan allows in-service rollovers, you could just do a trustee-to-trustee rollover, without having to use the CARES Act.

If you are still working for the company, and the plan does not allow for in-service rollovers, you could potentially use the CARES Act to withdraw up to a total of $100k, if (and only if), you have been impacted by COVID-19, where 'impacted' means

is diagnosed, or whose spouse or dependent is diagnosed, with the virus SARS-CoV-2 or the coronavirus disease 2019 (collectively, "COVID-19") by a test approved by the Centers for Disease Control and Prevention (including a test authorized under the Federal Food, Drug, and Cosmetic Act); or

experiences adverse financial consequences as a result of the individual, the individual's spouse, or a member of the individual's household (that is, someone who shares the individual's principal residence):
- being quarantined, being furloughed or laid off, or having work hours reduced due to COVID-19;
being unable to work due to lack of childcare due to COVID-19;
- closing or reducing hours of a business that they own or operate due to COVID-19;
- having pay or self-employment income reduced due to COVID-19; or
- having a job offer rescinded or start date for a job delayed due to COVID-19.

If you meet those qualifications, then you may withdraw up to $100k (total), and you will have up to 3 years to put the money back into a qualified retirement plan (IRA, 401(k), etc.). Until you put the money back into a qualified retirement plan, you will have to pay taxes, but no penalty, on 1/3 of the withdrawal each year from 2020 - 2022, as required. If you put the total amount back in 2021 or 2022, you can amend your prior returns to get the taxes you paid refunded.

Additional information can be found by reading Revenue Notice 2020-50 here: (also referenced in the link above)

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