Contact your 401k plan administrator to determine if your 401k plan rules permit hardship withdrawals and, if so, if your situation qualifies. IRS rules require that hardship withdrawals apply to a financial burden that cannot be satisfied by any other source of funds. This may include college tuition, a down payment for a home or high medical expenses. Request a withdrawal from your 401k plan by completing a 401k plan withdrawal request. The form can by obtained from your administrator. You will have to provide your personal and account information on the form.
Then report the amount of your withdrawal on Line 16b of your Form 1040 income tax return. This amount will be added to your taxable income for the year and Multiply the amount of your distribution by 0.1 to calculate the penalty for the distribution. All hardship distributions are subject to a 10 percent early withdrawal penalty.
Then report the amount of the penalty on Line 58 of your Form 1040 tax return. This amount will be added to the taxes you owe for the year.
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