401(k) Early Withdrawal Calculator
What you actually keep when you take money out before 59½, and what it would have grown to
Last updated: October 2026 · 2026 federal brackets and penalty exceptions
Your withdrawal
State tax is an estimate using 2026 brackets. A few states treat retirement income differently.
Federal withholding of $4,000 will not cover the full bill. Expect to owe about $1,750 more when you file, so do not spend the whole check.
The growth you give up
Left invested at 7% a year, the $20,000 would be worth about $108,549 at age 65 (25 years from now). Withdrawing it today trades that for $14,250 of spending money.
How the cost of an early withdrawal is worked out
Money in a traditional 401(k) has never been taxed. When it comes out, the amount is added to the rest of your income for the year and taxed at your ordinary rates. The calculator works out your federal tax with and without the withdrawal, using the 2026 brackets and standard deduction, and the difference is the tax the withdrawal causes. It does the same for your state. If you are under 59 and a half and no exception applies, it then adds the 10% additional tax on early distributions.
Withholding is shown separately because it is not the cost. It is a down payment on the tax. A cash-out after leaving a job must have 20% withheld for federal tax. If your actual federal tax plus the penalty is higher, you owe the rest at filing time.
Worked example
A 40-year-old single filer with $60,000 of other taxable income cashes out $20,000 after leaving a job. Her taxable income goes from $43,900 to $63,900 after the $16,100 standard deduction. That pushes $6,500 through the 12% bracket and $13,500 into the 22% bracket, so the federal tax on the withdrawal is $780 + $2,970 = $3,750. The 10% penalty adds $2,000. The plan withholds 20%, or $4,000, so she receives $16,000 but still owes about $1,750 at filing, before any state tax. She keeps about $14,250. Left invested at 7% for 25 years, the $20,000 would have grown to about $108,500.
Exceptions to the 10% penalty for 401(k) plans
Income tax still applies to all of these. Only the 10% additional tax goes away.
- Age 59 and a half or older. No penalty at all.
- Rule of 55. You leave the employer in or after the year you turn 55 (50 for qualifying public safety workers). Only that employer's plan qualifies.
- Substantially equal periodic payments. A fixed schedule under IRS-approved methods. Changing it before five years or age 59 and a half, whichever is later, brings back the penalty on every earlier payment.
- Total and permanent disability, and terminal illness certified by a physician.
- Emergency personal expense: one distribution a year of up to $1,000, repayable within three years.
- Birth or adoption: up to $5,000 per child, taken within a year of the birth or adoption.
- Domestic abuse victim: up to the lesser of $10,500 (2026) or half the vested balance, within a year of the abuse.
- Unreimbursed medical costs above 7.5% of your adjusted gross income.
- Federally declared disaster: up to $22,000 per disaster for people with an economic loss there.
- QDRO payments to a former spouse, and an IRS levy on the plan.
Plans do not have to offer the newer emergency, domestic abuse and disaster withdrawals, so check with your plan before counting on them. The higher-education and first-home exceptions apply to IRAs only, not to a 401(k).
Before you withdraw
A 401(k) loan avoids both tax and penalty if you repay it. If you have left the job, rolling the balance to an IRA keeps it invested and lets you take only what you need. Compare the long-run effect with the 401(k) calculator, and see how a withdrawal changes your plan in the retirement withdrawal calculator.
Frequently asked questions
How much does it cost to cash out a 401(k) early?
Before age 59 and a half you usually pay ordinary federal income tax on the whole amount, a 10% additional tax, and state income tax where your state has one. On a $20,000 withdrawal for a single filer earning $60,000, that is about $3,750 of federal tax and a $2,000 penalty, close to 29% before any state tax. In a high-tax state the total can pass a third.
Why did my plan only send me 80% of my withdrawal?
A cash-out that could have been rolled over is an eligible rollover distribution, and the plan must withhold 20% for federal tax. That withholding is a prepayment, not the final bill. If your real tax plus the 10% penalty comes to more than 20%, you owe the difference when you file. A hardship withdrawal is not eligible for rollover, so the default withholding is 10% and you can choose a different amount.
What is the Rule of 55?
If you leave your job in or after the calendar year you turn 55, withdrawals from that employer's 401(k) are free of the 10% penalty. The age is 50 for qualifying public safety employees. It applies only to the plan of the employer you left, not to IRAs or plans from earlier jobs, and income tax still applies.
Can I take $1,000 from my 401(k) for an emergency without the penalty?
Yes, if your plan offers it. Since 2024 you can treat one distribution of up to $1,000 a year as an emergency personal expense distribution, free of the 10% penalty. You can repay it within three years. If you do not repay it, you cannot take another one for the next three calendar years unless your new contributions cover it.
Is a hardship withdrawal free of the penalty?
No. A hardship withdrawal lets you get at the money while still employed, but the 10% penalty still applies unless a separate exception covers it, such as medical costs above 7.5% of AGI, disability, or birth or adoption expenses up to $5,000 per child.
Is a 401(k) loan better than a withdrawal?
Often, yes. A loan is not taxed and has no penalty as long as you repay it on schedule, and the interest goes back into your own account. The risk is leaving your job: the unpaid balance can be treated as a distribution unless you roll it over by your tax return due date, including extensions.