What is the 10 percent early distribution penalty and how can an IRA holder avoid it?
Money taken out of a traditional IRA before the IRA holder reaches age 59 is considered an early distribution and is generally subject to a 10 percent penalty. This does not apply in a situation of death, disability, equal payments, medical expenses, health insurance premiums following unemployment, first home purchase, higher education expenses or IRS levy.
Related Questions
- I want to retire before age 59. How do I avoid the 10% early distribution penalty on retirement payments from my 401k?
- Are there any circumstances when a taxable distribution taken from my IRA before age 59 will avoid the 10% penalty?
- What is the 10 percent early distribution penalty and how can an IRA holder avoid it?
