Legal Question in Bankruptcy in Kentucky

I strongly urge you to rethink the use of your 401k in that way. Right now, if you have to file bankruptcy, the credit card debt is dischargeable (made to go away) and the 401k is 100% exempt (you can keep all of it through a bankruptcy). If you withdraw it, you must pay taxes AND a hefty penalty. The only reason to consider doing this is if you can withdraw enough to pay the debt AND pay the taxes plus penalty AND be certain you will not still have to file bankruptcy in the next year or so.

Some people take loans out of their 401k. This also would be a big risk because the 401k loan is not dischargeable while the credit card debt is dischargeable.

So, find a bankruptcy attorney and talk through your whole situation before you do anything.