Here is a way to convert your traditional 401K into tax-free distributions by converting to a Roth 401K. The upside is you get the tax-free treatment when you retire; the downside is you have to pay tax now on the amounts you convert. See more details in this post by Ashlea Ebeling in Forbes:

http://www.forbes.com/sites/ashleaebeling/2014/01/03/the-in-plan-401k-roth-conversion-strategy/

Your employer has to allow Roth 401K conversions (more and more are allowing this) and you need to be able to pay the tax when you file your taxes in 2015. If you can do this, since tax rates are only going to go up in the future it may make a lot of sense to at least think about this. If you have a solo 401K in your corporate or self employed business, you should really look at this, too.

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