Congress may let you take $100,000 from your 401(k). What you should know

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Congress may let you take $100,000 from your 401(k). What you should know
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A provision in the Senate's coronavirus relief bill will allow affected savers to pull up to $100,000 from their retirement plans, free of the 10% early withdrawal penalty. Here are 3 things you should know.

The Senate is battling over a coronavirus relief bill, including a measure that permits affected savers to take a hardship withdrawal of up to $100,000 from their 401 retirement plan.

You’d still be on the hook for any income taxes on the amount. However, the measure would give you three years to pay those taxes and replace the money you took out. of COVID-19 stimulus measures, one of which allows savers to take emergency withdrawals – known as hardship distributions – of up to $100,000 from their retirement plans.

The proposed legislation also would issue families rebate checks of $1,200 per individual and $500 per child, as well as suspend payroll taxes for employers.

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