There are a number of different 401k withdrawals options open to those people who invest in 401k plans. On eof the options which is available for persons over the age of 59 1/2 and but under the age of 70 1/2 is to do a lump sum withdrawal of all the monies in your account. Your 401k plan provider will issue a check for what your account is worth minus a twenty percent (20%) withholding. This iwithholding tax is mandated by the Internal Revenue Service (IRS) and is held to cover any income tax you may need to pay when you file your tax return. Alternatively, it may end up as a part of a refund if you are over-withheld when your tax return has been filed. Depending on the amounts involved and the exact nature of your contributions, a lump sum withdrawal may not be a good option becaus eof the tax consequences.