Americans have been dipping into saving since the pandemic.
Record inflation, job loss, pay cuts, lower bonus pay, you name it.
People should NOT be penalized for using 401k money to get through hard times.
I would propose 401k penalty RELIEF for 2024 with a tax code change,
In addition I would propose a 401k penalty REFUND for years 2020-2023.
These are people doing the right thing.
They are not asking for a handout. They are not defaulting on debt.
Why penalize someone for during hard times?
The 10% government penalty is not a large sum of money on the federal budget, but for Americans in need, it is a strong policy move and shows the govt supports its citizens.