Tax

Have a Tax Question? Ask a Tax Expert

Ask an Expert,
Get an Answer ASAP!

Tax

I am going back to school-an expensive ($23k) fast track IT

Customer Question
school. Tax wise: Should I borrow from...
I am going back to school-an expensive ($23k) fast track IT school.
Tax wise:
Should I borrow from my 401k knowing that I hope to leave my current employer and be taxed on the outstanding balance, or
Should I take a Salle Mae loan?
How are funds taxed that originate as a loan against the 401k?
What else should I consider?
Roger Ochs
Submitted: 1 year ago.Category: Tax
Show More
Show Less
Ask Your Own Tax Question
Answered in 9 minutes by:
9/8/2016
Tax Professional: ABC Accounting Group, Certified Public Accountant (CPA) replied 1 year ago
ABC Accounting Group
ABC Accounting Group, Certified Public Accountant (CPA)
Category: Tax
Satisfied Customers: 714
Experience: Business Consultant/Accounting Manager
Verified

I would not take the 401k out. Unless you were staying with your employer, you could take out a loan from your 401k for education. The loan has an interest rate on it, but you are paying the interest back to yourself/your account. The loan is not taxed, unless you leave before the final payment is due. Then, it is taxed as a 401k withdrawal.

If you do leave your employer and do not take out a 401k loan, you can roll over the funds to an IRA (tax-free - within 60 days of when you leave).

I would check the interest rates on a Sallie Mae loan as well (website is https://www.salliemae.com/). Some other loans can be found on the following website:

https://studentaid.ed.gov/sa/types

Let me know if you have any questions.

Ask Your Own Tax Question
Tax Professional: ABC Accounting Group, Certified Public Accountant (CPA) replied 1 year ago

If you have any questions, let me know. If not, a positive rating is very much appreciated.

Ask Your Own Tax Question
Ask ABC Accounting Group Your Own Question
ABC Accounting Group
ABC Accounting Group
ABC Accounting Group, Certified Public Accountant (CPA)
Category: Tax
Satisfied Customers: 714
714 Satisfied Customers
Experience: Business Consultant/Accounting Manager

ABC Accounting Group is online now

A new question is answered every 9 seconds

How JustAnswer works:

  • Ask an ExpertExperts are full of valuable knowledge and are ready to help with any question. Credentials confirmed by a Fortune 500 verification firm.
  • Get a Professional AnswerVia email, text message, or notification as you wait on our site. Ask follow up questions if you need to.
  • 100% Satisfaction GuaranteeRate the answer you receive.

JustAnswer in the News:

Ask-a-doc Web sites: If you've got a quick question, you can try to get an answer from sites that say they have various specialists on hand to give quick answers... Justanswer.com.
JustAnswer.com...has seen a spike since October in legal questions from readers about layoffs, unemployment and severance.
Web sites like justanswer.com/legal
...leave nothing to chance.
Traffic on JustAnswer rose 14 percent...and had nearly 400,000 page views in 30 days...inquiries related to stress, high blood pressure, drinking and heart pain jumped 33 percent.
Tory Johnson, GMA Workplace Contributor, discusses work-from-home jobs, such as JustAnswer in which verified Experts answer people’s questions.
I will tell you that...the things you have to go through to be an Expert are quite rigorous.

What Customers are Saying:

I really was impressed with the prompt response. Your expert was not only a tax expert, but a people expert!!! Her genuine and caring attitude came across in her response...

T.G.WMatteson, IL

I WON!!! I just wanted you to know that your original answer gave me the courage and confidence to go into yesterday's audit ready to fight.

BonnieChesnee, SC

Great service. Answered my complex tax question in detail and provided a lot of additional useful information for my specific situation.

JohnMinneapolis, MN

Excellent information, very quick reply. The experts really take the time to address your questions, it is well worth the fee, for the peace of mind they can provide you with.

OrvilleHesperia, California

Wonderful service, prompt, efficient, and accurate. Couldn't have asked for more. I cannot thank you enough for your help.

Mary C.Freshfield, Liverpool, UK

This expert is wonderful. They truly know what they are talking about, and they actually care about you. They really helped put my nerves at ease. Thank you so much!!!!

AlexLos Angeles, CA

Thank you for all your help. It is nice to know that this service is here for people like myself, who need answers fast and are not sure who to consult.

GPHesperia, CA

< Previous | Next >

Meet the Experts:

Wallstreet Esq.

Wallstreet Esq.

Tax Attorney

586 satisfied customers

10 years experience

Mark D

Mark D

Enrolled Agent

1,300 satisfied customers

MBA, EA, Specializing in Business and Individual Tax Returns and Issues

Richard

Richard

Tax Attorney

4,310 satisfied customers

29 years of experience as a tax, real estate, and business attorney.

Robin D.

Robin D.

Senior Tax Advisor 4

13,695 satisfied customers

15years with H & R Block. Divisional leader, Instructor

Megan C

Megan C

Certified Public Accountant (CPA)

8,651 satisfied customers

Licensed CPA, CFE, CMA, CGMA who teaches accounting courses at Master's Level

jgordosea

jgordosea

Enrolled Agent

2,885 satisfied customers

I've prepared all types of taxes since 1987.

R. Klein, EA

R. Klein, EA

Enrolled Agent

1,839 satisfied customers

Over 20 Years experience

< Previous | Next >

Related Tax Questions
What are the taxes rates 2016 for term gains in irrevocable
what are the taxes rates 2016 for long term gains in irrevocable trusts … read more
Chad CFP ®
Chad CFP ®
Certified Financial Planner(R), Pro
Master\u0027s Degree
736 satisfied customers
A partner sold his interest in an LLC to the other partner.
A partner sold his interest in an LLC to the other partner. He still receives distributions, which are handled as payments to a retiring partner according to Internal Revenue Code §736(a). The questio… read more
Richard
Richard
Tax Attorney
Doctoral Degree
4,310 satisfied customers
I have a client who's child goes to private school. The
Hi- I have a client who's child goes to private school. The school district is reimbursing them the tuition for the private school and also legal fees that they incurred to get the district to pay for… read more
NPVAdvisor
NPVAdvisor
CFP Licensee and Practitioner
Master's Degree
180 satisfied customers
What is the rate of tax I will pay on the gain from the sale
What is the rate of tax I will pay on the gain from the sale of my house … read more
Richard
Richard
Tax Attorney
Doctoral Degree
4,310 satisfied customers
Given that the current 1041 tax rate on 401(k) income is
Given that the current 1041 tax rate on 401(k) income is $3206 + 39.6% over $12,400, what will be the new tax rate and will it apply for 2017?… read more
PDtax
PDtax
Owner
Master\u0027s Degree
1 satisfied customers
We have a small private school connected to our church. The
We have a small private school connected to our church. The school director refuses to give accurate/complete information about its checking account/debit card account, and is very evasive about monie… read more
abci168
abci168
Principal
27 satisfied customers
What is the order in which penalties and interest are
What is the order in which penalties and interest are applied in payments on previous years … read more
NPVAdvisor
NPVAdvisor
CFP Licensee and Practitioner
Master's Degree
180 satisfied customers
We are interested in buying a solar farm. What are the tax
Hi! We are interested in buying a solar farm. What are the tax incentives? Is it just the 30% tax credit, or will we get to depreciate all the solar equipment with bonus depreciation? Thanks! … read more
emc011075
emc011075
Senior Tax Specialist
Bachelor's Degree
16 satisfied customers
What would the federal and state tax rate percentages be for
What would the federal and state tax rate percentages be for a $7700 IRA early withdrawal in Ohio?… read more
Barbara
Barbara
Enrolled Agent, Paralegal
3,483 satisfied customers
Tax question - Form 1099, Line 8 Tax Exempt Interest
Tax question - Form 1099 , Line 8 Tax Exempt Interest reflects $500; OID 1099 is 0. Under heading Detail for tax exempt interest it says tax exempt interest is $300. Under Detail for Tax Exempt OID it… read more
Chad CFP ®
Chad CFP ®
Certified Financial Planner(R), Pro
Master\u0027s Degree
736 satisfied customers
I represent a high school booster club and was unaware of
I represent a high school booster club and was unaware of quarterly tax filings that we were supposed to file. We are a 501(c)3. … read more
Mark Taylor
Mark Taylor
Certified Public Accountant
Masters
2,220 satisfied customers
What is the income tax rate if it is not withdrawn from the
Hi! What is the income tax rate if it is not withdrawn from the LLC? The owner has not withdrawn any balance from the business all the amount reinvested into the business. Thank you!… read more
Barbara
Barbara
Enrolled Agent, Paralegal
3,483 satisfied customers
Income tax question. Are there any ways that interest on an
income tax question. Are there any ways that interest on an insurance policy can be tax deductible? … read more
Robin D.
Robin D.
Senior Tax Advisor 4
Vocational, Technical or Trade School
13,695 satisfied customers
I KNOW THE INTEREST ON A STUDENT LOAN FOR EDUCATION IS TAX
I KNOW THE INTEREST ON A STUDENT LOAN FOR EDUCATION IS TAX DEDUCTIBLE. HOW ABOUT THE INTEREST ON A PARENT LOAN /(FOR A SYUDENT CHILD) ALSO FOR EDUCATION?… read more
Mark Taylor
Mark Taylor
Certified Public Accountant
Masters
2,220 satisfied customers
My question is this. We are a small nonprofit school. We
Hello - my question is this. We are a small nonprofit school. We offer a discounted tuition rate if families become members of an associated learning society affiliated with the school which requires … read more
Robin D.
Robin D.
Senior Tax Advisor 4
Vocational, Technical or Trade School
13,695 satisfied customers
Is taxable for Scholarship a high school student receives
Is taxable for Scholarship a high school student receives from non-profit organization ? (Amount is 4,000.00)?… read more
Chad CFP ®
Chad CFP ®
Certified Financial Planner(R), Pro
Master\u0027s Degree
736 satisfied customers
How are the proceeds of sale of a LLC interest taxed; as
How are the proceeds of sale of a LLC interest taxed; as ordinary income or as capital gains? … read more
Mark Taylor
Mark Taylor
Certified Public Accountant
Masters
2,220 satisfied customers
Tax payer is a school teacher and her school pays for the
Tax payer is a school teacher and her school pays for the majority of her health insurance. Taxpayer pays $5000 for medical insurance. Her gross pay is $50,000, her net pay on her W-2 is $45,000 which… read more
ABC Accounting Group
ABC Accounting Group
Certified Public Accountant (CPA)
714 satisfied customers
Disclaimer: Information in questions, answers, and other posts on this site ("Posts") comes from individual users, not JustAnswer; JustAnswer is not responsible for Posts. Posts are for general information, are not intended to substitute for informed professional advice (medical, legal, veterinary, financial, etc.), or to establish a professional-client relationship. The site and services are provided "as is" with no warranty or representations by JustAnswer regarding the qualifications of Experts. To see what credentials have been verified by a third-party service, please click on the "Verified" symbol in some Experts' profiles. JustAnswer is not intended or designed for EMERGENCY questions which should be directed immediately by telephone or in-person to qualified professionals.

Disclaimer: Information in questions, answers, and other posts on this site ("Posts") comes from individual users, not JustAnswer; JustAnswer is not responsible for Posts. Posts are for general information, are not intended to substitute for informed professional advice (medical, legal, veterinary, financial, etc.), or to establish a professional-client relationship. The site and services are provided "as is" with no warranty or representations by JustAnswer regarding the qualifications of Experts. To see what credentials have been verified by a third-party service, please click on the "Verified" symbol in some Experts' profiles. JustAnswer is not intended or designed for EMERGENCY questions which should be directed immediately by telephone or in-person to qualified professionals.

Show MoreShow Less

Ask Your Question

x