Taking a 401(k) cash disbursement after leaving your company

Once you leave your company, you may have the option to request a cash disbursement. There is a $50 distribution fee charged for all distribution requests. A 20% mandatory federal tax withholding and applicable state tax withholdings will be applied to your account balance. You will have to pay income tax on the full balance, plus a 10% early withdrawal penalty tax if you’re under the retirement age 59 ½. (1) To review other 401(k) account options see the article “What happens to my Guideline 401(k) account if I leave the company?” 

 

(1) This information is for general education purposes only and not intended to be tax advice. We encourage you to consult a qualified tax professional before requesting a distribution.

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