IRA Distribution
Can a client take a withdrawal anytime in the year that they will be 59 1/2 or do they have to wait until they actually turn
59 1/2.
Can a client take a withdrawal anytime in the year that they will be 59 1/2 or do they have to wait until they actually turn
59 1/2.
Permalink Submitted by Alan Spross on Mon, 2009-07-06 20:47
Please post questions on the Discussion Forum portion in the future. Thanks
To avoid the 10% early withdrawal penalty, taxpayer must reach the exact day of turning 59.5, which is 6 months after the 59th birthday. Of course, there are other exceptions to penalty in addition to age 59.5 that could apply. This rule is for IRA distributions.
From an employer plan from which a taxpayer separated, the age requirement applies to separations in the year employee reaches 55, even though that birthday could come several months after the separation date. From other employer plans from which the employee separated before the year of 55th birthday, age 59.5 applies in the same manner as for IRAs.