Truckdriver
Well-known member
- Joined
- Feb 10, 2004
- Posts
- 976
No, you are correct. It depends on the plan (employer) when it comes to withdrawing employer contributions, which this equity share will be. I was speaking more generically about money in your 401k in general. Generally speaking (don't know the DAL specifics) you can withdraw the money that you contributed, plus earnings. If a DAL pilot really wants to get their hands on the $ from this equity distribution (after it actually happens of course...whenever that may be) they could simply take out an equivalent amount from the 401k, assuming they had at least that much in there from their own contributions. They would pay tax plus 10% penalty but would have effectively taken out the value of their equity distribution.
I don't think you pay a penalty on your own contributions, just the interest that those contributions may have earned. Of course you have to pay taxes on all of it, but I think the 10% only applies to the growth of your contributions. Could be wrong though. At Delta you can't touch the employer contributions until you retire, quit, or get fired.