It is YOUR money. It goes with you when you leave, possibly not all of it if the employer contributed too and you are not fully vested (Time spent with the company, usually 5 years). If you don;t need the mney you would typically roll it over into another 401k or IRA. If you need to cash it out, you need to pay the income tax on it to Fed and possibly state, AND a federal penalty. I want to say it is an additional 10%, but not sure.