Liquidating an old 401k
Note that you don’t have to itemize your deductions to take advantage of this provision.If the IRS levies your retirement account, you will pay income tax (duh!You cannot try it from your 401k, or you will run into the 20 percent withholding and 10 percent penalty issue.
So you will have to pay part of that penalty on money you never receive. This provision applies to those over 55 who have left their company.
Have your 401k plan send the money directly to the IRA custodian.