Ask Terry Questions 401K Withdrawals

401K Withdrawals

By Terry Savage on January 29, 2019 | Financial Planning / Retirement

Can I still withdraw funds from my, tax-deferred, 401K so that they are taxed for 2018? I had heard somewhere that I have until April 2019 to do so. Thanks,

Terry Says

If you are talking about taking your Required Minimum Distribution because you reached age 70-1/2, there IS a grace period until April 1st to take that FIRST distribution.  So if you turned 70-1/2 in 2018, you would have until April 1st to take the RMD.  Subsequently, you must take your RMD before the end of the calendar year — based on the previous year’s year-end valuation.

But if you are taking money out of a 40l(k) for any other reason than an RMD, you must pay taxes in the year in which the money is received. (Plus a 10% early withdrawal penalty if you are under age 59-1/2.)

Recent Financial Planning / Retirement Questions



a personal
finance question