I understand you can avoid the 10% penalty for early distributions from an IRA when using the funds to pay for unreimbursed medical expenses that exceed 10% of your AGI. My understanding is that the penalty is ONLY avoided for the specific amount of medical expenses that exceed 10% of your AGI. What if your AGI is $100k, your medical expenses are $17k and the max out-of-pocket with your health insurance is $7800? Even though the total amount paid by the IRA owner (i.e. $7800) is less than 10% of their AGI, would $7000 of their $7800 avoid the 10% penalty since their actual medical expenses are $7000 above the 10% of AGI threshold? I hope that make sense. Thanks so much!