You don't do anything.  If you are over 55, you can get your pension.  If this is an IRA, you pay the 10%

I'm not looking over your shoulder, so I can only guess what 10% penalty you're talking about.

https://www.irs.gov/taxtopics/tc558

10% penalty for early withdrawal from 401(k)

In the 1099-R interview, after you enter the data off your form, you should be asked whether or not you qualify for one of the exceptions to the early distribution penalty.

Yes, you do, and it's because you were separated from service after 55. Make sure to indicate that.

To be clear, this exception only applies to a distribution from the qualified retirement plan of the employer from which you separated from service in or after the year you reached age 55, not to a distribution from a 401(k) provided by some other employer.

I too would like to take advantage of the Rule of 55.  I turn 55 in 2021 but plan to separate before my 55th birthday by my choice.  I want to withdraw from my current employers 401k plan after the separation on a monthly basis until I'm 59 1/2.  Does it matter how the employer lists me from separation as I am not a "qualified retiree" in the eyes of the employer since I do not have enough years of service + age.   Am I still able to benefit and avoid the 10% penalty tax with the Rule of 55 or do I need to be a qualified retiree from my employer?

According to IRS.gov, the 10% early withdrawal penalty can be waived if distributions made to you after you separated from service with your employer if the separation occurred in or after the year you reached age 55. If you retire in 2021, that penalty can be waived.

[Edited 02-15-2021|06:40 PM PST]