I Hate Dialysis Message Board
Dialysis Discussion => Dialysis: Working while on Dialysis => Topic started by: frankswife on October 21, 2012, 07:11:33 AM
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Frank is on FMLA with a one year leave of absence from his job. He has been approved for SSDI with payments to start in March. He has a fairly large 401K that we could desperately use, but cannot access as long as he is still technically on the payroll. Since he has used all his sick time/vacay/personal time, I want him to give the company notice that he wont be returning so we can cash in his 401k. Is this ok? Are there any downsides to this? (Other than the obvious penalty and taxes we are going to pay). Thanks!
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I'm not sure, but I'm guessing he will have to wait. I don't think he gets the penalty if he is on disability but he will still have to pay the taxes.
I'd even go get a loan before March. Check out the penalties vs. disability. Why throw away money if you can keep from being penalized by waiting until March.
JMOpinion
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This question is above my pay grade. I would highly suggest contacting a tax advisor. He or she will probably be the best source of advice for your particular situation.
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I was able to get my 401K after I gave notice. It took a couple of months and they took a really big chunk for taxes.
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I heard you can be exempt from the 10% penalty if you are permanently and totally disabled. Does anyone know if this is true?
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just passing a long what I know, not sure about your question but you will want to be careful, some companies, including the one I work for will not accept dialysis as a disability, and will only accept intermittent FMLA, of course I don't know what frank does, but I have a sit down job so therefore I was denied disability through my work.
Good luck!
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FMLA is just to hold your job for 3 months it's no guarantee of any monies. There is usually a 30 day wait till disability insurance through work starts but as long as you have sick/vacation time that shouldnt be a problem. After 3 months you can switch to long term disability and get paid through that if you have it. Your SSDI if you filed should start roughly 5 months after your disability start date. As far as 401k I hear you can borrow against it with no penalty as long as you pay it back but if you take money out early your penalized a percentage. If you end up on long term disability and your job is terminated there might be a disability stipulation to cash it out with no penalty but then again there might not depending on your carrier.