Please Note: Hardship Withdrawals are regulated by the Internal Revenue Service.
Acceptable reasons for a Hardship Withdrawal:
- Medical Expenses (copy of medical bill(s) not covered by insurance)
- Purchase of a Primary home (copy of good faith note or sales contract)
- Tuition for a participant or dependent of a participant (copy of tuition bill(s))
- To avoid eviction or foreclosure from the primary home (copy of eviction/foreclosure notice from mortgage company or the court)
- Funeral Expenses (copy of funeral bill(s))
Proof of hardship must include the amount owed.
Most hardship distributions are subject to a 10% penalty and the distribution amount is taxable as income. Both are reported on your Federal Income tax return, Form 1040. Your employee contributions to your 401(k) must cease for 6 months from the date you take a hardship distribution. It is your responsibility to start contributions again.