Tax consequences of 401K distribution

[Okie1]

i am a resident of oklahoma. i recently got a divorce. part of the settlement was to take a early distribution from my employer sponsored 401k plan and fund an irrevocable trust in the name of and for the benefit of my 8 yr old son.

My question; is there a way that the trust can be structured or is there a particular investment method available that would allow the funds from my 401k to retain their tax deferred status? Can I avoid the 10% early with-drawal penalty and regular income taxes on the money that come from my 401k and go the the trust?

 

[ALawyer]

This is one you really should have asked of your lawyer BEFORE the settlement was agreed to. The lawyer who represented you should have been asked and unless the tax consequences were known you should not have agreed.