Will I owe taxes on my distribution if I cash it out?

Your distribution will be taxed as personal income based on your income tax bracket. For most normal distributions, the IRS will require a minimum of 20% to be withheld for tax purposes at the time of distribution. When you file your tax return next year, you will account for the remaining taxes due, if any, along with any penalties. See Early Withdrawal Penalty.

For ROTH 401k’s, your ROTH contributions are not subject to either state or federal income tax. Your ROTH earnings may be subject to tax based on the timing of the distribution.