President Obama’s planned 2016 budget is proposing for a provision that, if passed, would allow unemployed citizens to withdraw up to $50,000 from their individual 401(k) accounts without penalty.

Currently in the United States, early withdrawals are subjected to a 10% penalty plus income tax requirements.  An “early withdrawal” is a withdrawal made before age fifty nine and a half.

Whilst the proposal does get rid of the 10% penalty, there are some other rules attached to the plan.  These include:

• Withdrawals would still be subject to income taxes;
• Any person wishing to make a withdrawal must have received unemployment compensation for more than 26 weeks;
• Participants could withdrawal at least $10,000;
• If a participant has more than $10,000 in their account, the person could withdrawal half of their plan-balance up to a total withdrawal of $50,000 per year;
• Participants would have to withdrawal the funds either in the year they received unemployment compensation or the following year.

Right now, human resource experts are really not sure how likely the provision is to pass but NBC News is reporting that it appears to have bipartisan support.