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401k withdrawal for starting new business

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SoonerSublime

Junior Member
What is the name of your state? Oklahoma

I have a little over $40000 in my 401k and have decided to start a business with it. My question, Is it within my right to pull the money out, incur the 10% penalty and not have to pay taxes on the withdrawal because I will be investing it in my business(capital loss) and how does this work. I will check frequently if you have any questions about what I am trying to do. I will be starting an llc if that is needed to do this.
 


irsos

Member
No, it is not possible. You may have a loss in the early operation of your business that may offset some of the 401K income but otherwise, you will pay tax on it at your marginal tax rate.
 

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