My client took money from 401K after she lost her job and couldn't find another. Can she avoid the penalty? She has 3 kids and only made $13000 from her job. Took $28000 from the 401 K. I was thinking a hardship penalty but I can find anywhere to put that on the 1099-R worksheet or the 5329. She did not tell them it was a hardship when she took it out.
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@utah-arizona-taxlady I frequently use posts here to substantiate bad news that i have to give my clients. Sooner or later they learn to talk to their preparers before they make an out of the ordinary financial move during the year.