We've tracked this promise on penalty-free 401(k) withdrawals since President Barack Obama took office. It seems like it's time to stick a fork in it and declare it done.

The measure, which Obama proposed during the fall of 2008 as the economy was swooning, would have allowed workers to take money from their 401(k) retirement accounts before retirement, but without the usual penalty of 10 percent on top of regular taxes. The idea was to help cash-strapped workers get through hard times without having to absorb penalties for their bad fortune.

The potential downside to the idea is that money taken out now won't earn compounded growth later to build wealth. Also, early withdrawals lock in market losses that might turn around in time.

Penalty-free withdrawals weren't included in the economic stimulus bill that became the American Recovery and Reinvestment Act. Nor were they part of Obama's budget outline, which Congress approved on April 2, 2009. It doesn't appear that any member of Congress has introduced such a measure. Everyone we've asked about the idea says it's not going to happen.

If this measure ever rises from the dead, we'll be happy to recalibrate the Obameter and take another look. But people across the country are preparing their taxes right now, and if they took money out of their 401(k) before retirement in 2008, that penalty will be there staring them in the face. We rate this Promise Broken.

Readers have asked us regularly over the last few weeks about penalty-free 401(k) hardship withdrawals. Taking a chunk from their retirement savings would tide them over through the recession, they say.

The rules for hardship withdrawals are complicated and can vary depending on your employer's policies and how close you are to retirement. But in general, you can withdraw money early if you have no other source of money and can document a specific hardship — medical bills, impending foreclosure, college expenses and other things. (See detailed guidelines from the IRS on hardship withdrawals .) The penalties are steep: The government taxes the money as regular income, and there's an additional 10 percent penalty.

Obama proposed penalty-free withdrawals as part of an overall plan to address the economy. We noted a few weeks ago (see our previous update below) that penalty-free 401(k) withdrawals were not in the proposed economic stimulus bill, formally known as the American Recovery and Reinvestment Act of 2009. The measure didn't make it into the final version, either, which the president signed on Feb. 17, 2009.

We've searched congressional databases and still can't find any legislation that's been introduced to make 401(k) withdrawals penalty-free. Congressional staffers have indicated there are no plans for it to get serious consideration any time soon.

If the legislation is introduced soon and gains momentum, we'll move the meter to In the Works. But for now, because it didn't make it into the economic package and there aren't any signs that it will re-emerge soon, we are rating this promise Stalled.

We've received several e-mails from readers who say they're facing difficult times financially and want to know the status of Obama's pledge to ease penalties for early withdrawals from 401(k) retirement plans.

As of this writing, the measure is not in the stimulus bill, nor in any other legislation that we could find.

The rules for hardship withdrawals are complicated and can vary depending on your employer's policies and how close you are to retirement. But in general, you can withdraw money early if you have no other source of money and can document a specific hardship — medical bills, impending foreclosure, college expenses and other things. (See detailed guidelines from the IRS on hardship withdrawals .)

But people who take hardship withdrawals pay a price. They are taxed on the money at the regular rate, and then pay an additional 10 percent penalty on top of that.

Besides that, the money won't earn compounded growth to build wealth, and during these economic times, early withdrawals lock in market losses that might turn around in time.

Obama proposed eliminating the penalty (but not the regular taxes) on hardship withdrawals, and making it retroactive to 2008. If passed, that could help people who will have to pay taxes on money they've already taken. But as we said, the measure is not in the stimulus bill.

" It's not a slam dunk at all in Congress, because there's continuing concern about access to retirement funds before retirement," said Ed Ferrigno, vice president of Washington affairs for the Profit Sharing/401K Council of America, an association that represents employers that sponsor 401(k) plans.

His group is ambivalent about lifting the penalty temporarily. People are facing tough times economically, but the measure might encourage people to take money out of funds that they might not take otherwise.

" It should be an absolute last resort," he said. "On the other hand, if it's a matter of losing the house, feeding the kids, or a health emergency, you're going to do it anyway."

He said it's hard to tell if the matter will be addressed in later legislation, because it's not clear why it didn't end up in the stimulus bill. If it's passed later in the Congress, it could be made retroactive.

Obama proposed lifting the penalty on hardship withdrawals as part of an overall agenda to turn the economy around. Some of his proposals, such as a tax cut for workers, made it into the stimulus package, but others have not. It seems early to rate this item Stalled without more evidence. The primary reason we're checking this item now is because readers have e-mailed us and asked us if it was in the stimulus bill. We found that it's not. No Action.