401k to IRA

There was a similar thread in this discussion about what Im going to
ask but not really sure I understood.  I am 23.  I have been working
at a good company for about 3 years now and have been contributing to
my 401k and my employer has as well.  Over the years I have racked up
some debtthat I would like to get rid of.
    I was told by a friend of mine that I would be able to take about
2000 of my 3000 in my 401k and move it to an IRA.  That would give me
a better tax refund.  And I was plannin on using that refund as the
final blow to get rid of my debt.

Is this true?