People may need to tap into their individual retirement account before turning age fifty-nine and a half. Withdrawing money before that age subjects the funds to an additional 10% tax
. Withdrawing funds after that age, there's no additional tax penalty. This additional levy can be avoided under the following circumstances:
Questions about taking an early distribution from an IRA? Leave a comment below.
- You had a "direct rollover" to your new retirement account,
- You received a lump-sum payment but rolled over the money to a qualified retirement account within 60 days,
- You were permanently or totally disabled,
- You were unemployed and paid for health insurance premiums,
- You paid for college expenses for yourself or a dependent,
- You bought a house for the first time
- You paid for medical expenses exceeding 7.5% of your adjusted gross income, or
- The IRS levied your retirement account to pay off tax debts.