Does 401k withdrawal affect Washington ESD unemployment benefits eligibility?

401k withdrawals are generally not considered earned income for unemployment purposes, but you should still report it when filing your weekly claim just to be safe.

I withdrew from my 401k last year while on unemployment and it didn't affect my benefits at all. Washington ESD only cares about work income and certain types of pension payments.

Be careful though - if you're having trouble reaching Washington ESD to verify this, I found claimyr.com really helpful for getting through to an actual agent. They have a video demo at https://youtu.be/7DieNd3C7zQ that shows how it works. Saved me hours of calling.

The key thing is that 401k withdrawals are NOT wages or earnings from work. Washington ESD is looking for income that would indicate you're working, not retirement fund access.

I'm in the same boat - thinking about early withdrawal but worried about penalties AND how it might affect my claim.

Just make sure you understand the difference between a withdrawal and a loan from your 401k. Loans don't count as income at all.

If you need to confirm this with Washington ESD directly, definitely try that Claimyr service I mentioned earlier. I was stuck in adjudication for weeks and couldn't get through until I used them.

Washington ESD's handbook specifically mentions that retirement distributions are not deductible from benefits. You're good to go as long as you report it properly.

Been there done that - withdrew $8000 from my 401k while collecting UI and had zero problems. Just be honest on your weekly claim.

Wait, I thought ANY income had to be reported and could reduce your benefits?

The confusion comes from people mixing up 'income' and 'wages.' Washington ESD cares about wages and work-related earnings, not all forms of income.

If you're really unsure, that claimyr service mentioned earlier might be worth it. I used it last month when I had questions about pension payments.

I withdrew from my Roth IRA (different than 401k but similar concept) and Washington ESD didn't care at all. Still got my full weekly benefit amount.

The Washington ESD website has a whole section about what counts as reportable income. 401k withdrawals are specifically listed as NOT affecting benefits.

Just went through this exact situation 2 months ago. Zero impact on my weekly claims. You're overthinking it!

One more vote for it being fine - I've done both 401k withdrawal and Roth conversion while on unemployment with no issues.

Final thought - if you need to discuss your specific situation with Washington ESD, definitely consider using claimyr.com. Their system makes it so much easier to actually reach an agent instead of getting hung up on constantly.

Great discussion! Always nice to see people helping each other navigate the Washington ESD system.

Summary for anyone else finding this thread: 401k withdrawals don't affect Washington ESD benefits, just report them accurately on your weekly claim and keep documentation.

This is such valuable information! I'm in a similar situation and was really stressed about whether a 401k withdrawal would mess up my unemployment benefits. Reading everyone's experiences has been incredibly reassuring. It sounds like the key is just being transparent when reporting it on the weekly claim form. Thanks to everyone who shared their stories - this community really does help navigate these confusing situations!