What would the penalty be?
I am in a financial hardship right now. I mean gas going up, food going up, hit with an 1200 dollar car repair, my job cut overtime. But I had stopped paying creditors a long time ago and have been wanting to file bankruptcy but just couldnt afford it. But now I got a letter from a law office in my state who is saying I am being reviewed to confirm my place of employment, any assets or property of value for a potential lawsuit and if my wages were garnished I would be screwed!
But I do have about 1140 and I know that is to small for a loan and I know cashing out is not a good idea with taxes but I kind of have no choice here as I cannot borrow that kind of money from anyone. But my question is, if I cash out will I get the whole 1140.00 and be responsible myself for paying taxes, or will they take taxes and give me what is left? And if it is the second how much would I have left?
June 19th, 2009 at 5:04 pm
U’ll b responsible 4 paying the taxes on that. Try 2 talk 2 ur creditors n c if u can pay them in monthly installments.
June 20th, 2009 at 7:35 pm
If you cash out a 401K or IRA, they’ll most likely withhold 20% for taxes. That might or might not be enough to pay all the tax on it, that depends on your entire income and on your tax bracket. You’ll end up owing income tax at whatever your bracket is, plus a 10% penalty ($114) if you are under age 59-1/2.
June 23rd, 2009 at 11:06 pm
Hi,
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