401k withdrawl

[SaradaChinnodu]

Has anyone withdrawn from their 401(k) before retirement or before moving back to India?
I'm exploring options and was curious if anyone has done an early withdrawal from their 401(k) — either while still in the U.S. or before relocating to India. If so, how much did you end up paying in taxes and penalties (federal, state, early withdrawal, etc.)? Would appreciate hearing real-world experiences

[SaradaChinnodu]

Heard that we would end up paying 30% flat tax (in case leaving US) + 10% penalty for early withdrawl making it a 40% cut. 

 

[Xtian_Teddy]

Just now, SaradaChinnodu said:

Heard that we would end up paying 30% flat tax (in case leaving US) + 10% penalty for early withdrawl making it a 40% cut. 

 

yes

[Spartan]

nee use case endo cheppu..enduku withdraw cheskuntunnav...?

lets assume u have 100K in 401K.

and ur AGI is 200K. 

if you plan to withdraw entire 100K before retirement, then..

you will get only 90K..

and your AGI for that year becomes 290K...for which you will be paying tax again. 

[SaradaChinnodu]

Also would like to hear whats the strategy for withdrawl if not planning to retire in US? Match up to employers contribution and put rest in S&Ps post tax to have more control ?

[Spartan]

2 minutes ago, SaradaChinnodu said:

Heard that we would end up paying 30% flat tax (in case leaving US) + 10% penalty for early withdrawl making it a 40% cut. 

 

tax bracket (federal + Statee) + 10% 

[SaradaChinnodu]

Just now, Spartan said:

nee use case endo cheppu..enduku withdraw cheskuntunnav...?

lets assume u have 100K in 401K.

and ur AGI is 200K. 

if you plan to withdraw entire 100K before retirement, then..

you will get only 90K..

and your AGI for that year becomes 290K...for which you will be paying tax again. 

What if I plan to move back to India in next 5yrs (prior to retirement to US) and looking for best withdrawl strategy and also wondering what would be the strategy to invest in 401k know ing that I would not be in US until retirement ...only. match company and put rest in s&ps

 

[Spartan]

Just now, SaradaChinnodu said:

What if I plan to move back to India in next 5yrs (prior to retirement to US) and looking for best withdrawl strategy and also wondering what would be the strategy to invest in 401k know ing that I would not be in US until retirement ...only. match company and put rest in s&ps

 

India vellaka withdraw chesko..

you will only pay 10% penalty... and withdraw less than 25K each year...daniki tax undadu.

this is only if you have GC or citizenship

[Thokkalee]

If you plan to withdraw, do it the next year after you move to India.. as you will not have any income here, you will be in the lower tax bracket.. 

[SaradaChinnodu]

1 minute ago, Spartan said:

India vellaka withdraw chesko..

you will only pay 10% penalty... and withdraw less than 25K each year...daniki tax undadu.

this is only if you have GC or citizenship

why would they not tax 25K per year withdrawl? wouldn't it count towards US income?

[SaradaChinnodu]

1 minute ago, Thokkalee said:

If you plan to withdraw, do it the next year after you move to India.. as you will not have any income here, you will be in the lower tax bracket.. 

non GC Aithey flat 30% + 10% penalty anta bro

[letstalk2024]

2 minutes ago, Spartan said:

India vellaka withdraw chesko..

you will only pay 10% penalty... and withdraw less than 25K each year...daniki tax undadu.

this is only if you have GC or citizenship

What if you are not a GC or usc 

[Thokkalee]

1 minute ago, SaradaChinnodu said:

why would they not tax 25K per year withdrawl? wouldn't it count towards US income?

Married filing jointly aithe 29K annual income varaku no tax..  if you get beyond that, you have to file taxes and pay taxes.. 

[Spartan]

7 minutes ago, SaradaChinnodu said:

why would they not tax 25K per year withdrawl? wouldn't it count towards US income?

this

5 minutes ago, Thokkalee said:

Married filing jointly aithe 29K annual income varaku no tax..  if you get beyond that, you have to file taxes and pay taxes.. 

 

[Spartan]

6 minutes ago, letstalk2024 said:

What if you are not a GC or usc 

you are not obliliged to file taxes in US then.