Using 401k lump sum to buy primary house.

[dondude]

What is the name of your state (only U.S. law)?

 

[cbg]

Purchase of a primary residence is a legally allowable reason under IRS regs to take a hardship withdrawal from a 401k plan, assuming that the 401k plan document allows for hardship deductions at all. It is also possible that the employee might be required to exhaust all loan options prior to taking a hardship withdrawal - however, the employee would have to check into the terms of his or her own plan to know for certain.

If this is not the question please clarify

 

[dondude]

Original question was deleted somehow. I lost my job and house. My daughter is receiving SSI benefits. By using payout from 401k in the amount of 16,000 will she lose her benefits because it is considered income?

 

[Onderzoek]

If you withdraw the money from the 401k (which is excluded from resources right now since it is the retirement fund of a deemor - parent), the following month the money will be a countable resource and will put her over the $2000/$50000 resource limit and her checks should stop for as long as you have excess resources.

 

[dondude]

Thank You for your answer. The Home purchase and withdrawal will happen in the same calendar month. I'll make sure I keep all records to show this.