Penalty-free IRA early withdrawals

It is common knowledge that in most instances if you take an early withdrawal from your IRA you will pay a penalty. However, if you are willing to adhere to the requirements of 72(t) of the United States Tax Code, you can take an early IRS withdrawal without paying a penalty. You will still be taxed on the amount you withdraw but you will not be charged a penalty provided the distributions are “substantially equal periodic payments” or SEPPs under 72(t) and meet each of the requirements set for in that section to avoid a penalty.

For more details read, “Retirement: Tap your IRA early, penalty-free.”

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