Yes, if you are a victim of domestic violence in 2024 and take the distribution this year, then you may qualify for the exception to the early withdrawal penalty. This doesn't mean that you are exempt from taxation on the actual distribution itself, but just the 10% penalty for an early withdraw. It's important to note that if you repay the withdrawn money from the retirement plan within three years, you will be refunded for income taxes paid on the distribution amount. The IRS hasn't yet issued guidance on how this new domestic violence exception to the early withdraw penalty will be handled on Form 1099-R, and plan sponsors are still figuring out how to accommodate this new law.
It's likely that it'll be treated like other common early penalty withdrawal exceptions, meaning you will be asked follow-up questions in TurboTax when preparing your tax year 2024 return to indicate that you qualify for an exception to the early distribution penalty and it will be reported on Form 5329. For more discussion on this topic, see the response from dmertz here.
Additionally, take note of Pub 590 B page 2, the Distributions to victims of domestic abuse section.
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