Tax Tip #150

Withdrawals from a retirement plan prior to turning 59.5 years old is subject to a 10% penalty unless there is an exception.

Some of the exceptions include:

· Up to 22K withdrawn per federally declared disaster

· Medical Expenses

· Taking substantially equal payments for the longer of 5 years or until the recipient turns 59.5 years old. 

· People having a baby or adopting can take up to 5K

· Up to 10K withdrawn from an IRA for “first-time” home buyers

· Distribution from IRA used for the cost of higher education

· Purchase health insurance from an IRA if unemployed