Anyone know about 401k stuff?

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Tadpole
Anyone know about 401k stuff?

I had no idea where to put this post, if Im wrong and Ive wasted your time, I apologize.

I have like 15k invested in my 401k plan at my place of employment, but I need to take it out. I had a loan a few years back against my 401k, still working on paying it off, it was to move into a new place. My 401k company wont let me withdrawal money for hardship because Im not getting evicted, and because Im not experiencing a family death, however, I have paralegals serving me papers stating they are going to garnish my wages or get a court levy to withdrawal funds from my account. So, soon I will be evicted and lose the few things I have come to purchase, unless I can come up with a large sum of money. The 401k company said the only way I can get at MY money is if I terminate employment, and this job is too good to just quit. But does anyone know if they can do that? I mean, its MY money that I have been saving?! It just seems messed up to me...

   

   

Hot2na
Re: Anyone know about 401k stuff?

eeeks Tadpole! well i am not going to be of much help besides letting you know we do have a gug member amongst us who is very good at keeping us in the "tax filing/return" and most tax related questions...loop! her name is LynnH. and i'm certain once she is online and has the opportunity to read your thread, she'll offer up what she can/knows.

Tuna ><((((*> the other white meat! I am Keeper Of The Whip!

LynnH
Re: Anyone know about 401k stuff?

 

Number 4 in 's quote is an important one. payments necessary to prevent eviction from, or foreclosure on, a principal residence. Right on !

 

Here's what I have to add: The part that says "A financial need may be immediate and heavy even if it was reasonably foreseeable or voluntarily incurred by the employee."

Is it possible that the 401k plan withdrawals are contingent on how the employee came to this dilemma of needing funds.

Under a 457(b) plan, a hardship distribution can only occur when the participant is faced with an unforeseeable emergency. (Code § 457(d)(1)(iii))

An unforeseeable emergency is a severe financial hardship resulting from an illness or accident, loss of property due to casualty, or other similar extraordinary and unforeseeable circumstances arising as a result of events beyond the control of the participant or beneficiary. Examples of events that may be considered unforeseeable emergencies include imminent foreclosure on, or eviction from, the employee's home, medical expenses, and funeral expenses. Generally, the purchase of a home and the payment of college tuition are not unforeseeable emergencies.
(Reg. § 1.457-6(c)(2)(i))

Whether a participant or beneficiary is faced with an unforeseeable emergency depends on the facts and circumstances. However, a distribution is not on account of an unforeseeable emergency to the extent that the emergency can be relieved through reimbursement or compensation from insurance, liquidation of the participant's assets, or cessation of deferrals under the plan. (Reg. § 1.457-6(c)(2)(ii))

 

I'm going to assume that you borrowed against your 401k to move into a new place, not buy a home.

You are worried about getting evicted AFTER you are served papers for garnishment or levy. I certainly hope they serve you and your employer court ordered garnishment papers because if they do, you and your employer are required to fill out information detailing your financial position and submit it back to the courts to determine what amount 'can' be garnished from your paycheck.

In other words, from personal experience of handling the paperwork of employees who received court ordered garnishments, the employee and I were able to "significantly reduce" the amount garnished each paycheck. One of the main factors is how many dependents you have.

If I were you, I would go directly to whoever is in charge of this at your place of employment and sit down and talk with them. Payroll? Human Resources? I was simply the bookkeeper, but I did handle all of this. We couldn't do anything until the papers were served. For one employee, a second garnishment came in and I was able to have that one dismissed because you can't have 2 garnishments, it would cause hardship. The key here, is the hardship factor in garnishments. Of course, I must realize that your state may be different than mine.

Also, knowing who your 401k provider is would help. But so would the paperwork you should have concerning this. I will say that ours is through ING and I can go online and find out what I need to. Can you do the same thing? As stated before, you can get all kinds of answers from different people.

Some 401k plans will only let you borrow a percentage of what you have. If you want all of it, you must terminate your employment with that company. It's been that way for as long as I can remember. You already have borrowed against it and are still paying it back, so the amount you can borrow now is much less. Have you asked them if you can borrow any dollar amount? I'm going to guess they said no since they told you the only way was to quit.

Let me wrap this up a bit, (have to babysit in 2 minutes so I apologize for not being organized in my reply).

I would not quit.

I would find out if there was any money I could obtain from my 401k to get that quetion out of the way. Check online if you can too.

I would talk with payroll about the upcoming garnishment. Believe me, they will appreciate it.

Taking the garnishment may be the best bet as it shouldn't put you out of your home. <-------- From my experience.

Also wondering how large an amount of money your are talking about. If there are some personal things you don't wanted posted, please email me that and we'll just cover the basics here. The more I know exactly what is what, the more I could help you and do your footwork.

Forgot to add that if you are married and your wife works, a 401k company is less likely to let you borrow because you have other outlets to obtain the money.  fyi

I'll check back in later on you.  I'd like to help you get through this the easiest way possible.

Lynn 

 

If I was standing on a fish, I'd slip and fall......

juliek
Re: Anyone know about 401k stuff?

Hi Tadpole, do you have the copies that you signed when you entered the  401k account. depending on the specifics of your agreement, you'll know about the withdrawal arrangements, also, about eviction, once you are served the actual papers,(not the 5 day notice), you'll have a minimum of 30 days to either move or make arrangements with your present landlord. i know that's not much consolation, but every extra day helps. if and when you do get evicted, be sure to make copies and see if the 401k can be accessed then because of hardship.i have not known of people being denied their money, but i know that major penalties are assessed for early withdrawal of the $.

i'm not a lawyer or a paralegal, so make sure you verify any information. sometimes evictions are differerent depending on the state you live in. Good luck! keep us posted!  juliek

Tadpole
Re: Anyone know about 401k stuff?

Well, thank you guys SOOOOOOOOO much for giving me advice! I truly, truly appreciate it! Ive never been in a forum with so many helpful and kind people! Its totally worth the $25 bux to have some smart, nice people to look to for advice. I am going to send LynnH some info, and see if she can help. Ive been goin to all these outlets and getting no help... But thanks SO much everyone! =) Your all great!

LynnH
Re: Anyone know about 401k stuff?

 I'll be looking forward to your info.  We are a good place, I promise!

 

If I was standing on a fish, I'd slip and fall......

Tadpole
Re: Anyone know about 401k stuff?

Just thought I would post an update for anyone interested in the solution to my problem. I talked to my boss about my current situation and he has agreed to help me by talking to my 401k provider.  He has handled this type of situation in the past with another employee and said there would be no problem in getting it straightened out. =)  So I'm absolutely thrilled! I get to get out of debt finally! Not to mention, I got my dream car today too! My stepfather found it, bought it with his retirement, and I'm going to work on paying it back! IM SO HAPPY! Thanks LynnH for all your hard work and getting info for me and such, it is VERY much appreciated! love U ALL! Laughing

iamthedevil
Re: Anyone know about 401k stuff?

Glad things are looking up. But I gotta know, what kind of car was it?

LynnH
Re: Anyone know about 401k stuff?

 

 Ahh, I see  that you were able to come up with an alternative agreement with your boss.  Hopefully, this will turn out as you expect.

 If it should not turn out as expected, let me know, and we'll go over the original available options.

 I have a few concerns and a small list of items that I would like you to be aware of.  Will send you an email as soon as I can.  (I've been having internet issues, so I apologize for not having answered here sooner).

 Thank you for showing your appreciation....you are quite welcome.  Us Guggies love to help wherever we can.  You will see.  Before you know it you'll be helping others.

Please do  not hesitate to ask if you need anything else or if plans change.  We can always find a work-around.

 

Lynn 

 

 

 

 

If I was standing on a fish, I'd slip and fall......

Tadpole
Re: Anyone know about 401k stuff?

If you guys go to my account, my myspace profile photograph is my dream car! Money mouth Its just an 84 Chevy Blazer (same year I was born) with a 4 inch lift, 35's, a 454 big block, TH400 tranny, and NP205 transfer case, of course with the GM corporate 14 bolt rear differential! If you dont get all that, Im sorry, pretty much though, its bulletproof. I would have to push 900-1000 horsepower in order to break any of it! I absolutely love it! Im going to swap out a 6 inch lift I have laying around, with springs, and put some 39.5's on it, so it will gain another 4 inches of lift! Its got so much power, burns out everywhere I go! Anyways, www.myspace.com/fvckingp1mp is my myspace, and it shows the photograph there. Add me if you want, because I need more friends! And for the 401k, I will see my boss tomorrow, and he said he would have an answer monday, so Ill know for sure if his plan worked out or not. Thanks again for your help! Laughing

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