Ultimately I think the plan administrator will be the source of resistance to the plan to temporarily quit. While you may get away with taking a distribution during the time of severance, if you restart with the same company after a few months or a year, there is a very high chance the plan will not allow you to take further distributions prior to age 59.5.
Go look at the 401(k) withdrawal forms from Schwab or Fidelity:
https://www.schwab.com/resource/401k-di ... quest-form
https://www.fidelity.com/bin-public/060 ... t-form.pdf
You have to specify a reason for your withdrawal. You would presumably check the box for "Separated from service" on the Fidelity form or "Termination of employment" on the Schwab form. Then the plan administrator would send you an email and point out that you still work there. Then you would try to start a debate about the Rule of 55, and they will still tell you no, because the consequences to the plan are catastrophic.
Go look at the 401(k) withdrawal forms from Schwab or Fidelity:
https://www.schwab.com/resource/401k-di ... quest-form
https://www.fidelity.com/bin-public/060 ... t-form.pdf
You have to specify a reason for your withdrawal. You would presumably check the box for "Separated from service" on the Fidelity form or "Termination of employment" on the Schwab form. Then the plan administrator would send you an email and point out that you still work there. Then you would try to start a debate about the Rule of 55, and they will still tell you no, because the consequences to the plan are catastrophic.
Statistics: Posted by toddthebod — Fri Sep 26, 2025 3:20 pm — Replies 20 — Views 885