Topic Number 558 - Additional Tax on Early Distributions from Retirement Plans Other Than IRAs
To discourage the use of retirement funds for purposes other than normal retirement, the law imposes an additional 10% tax on certain early distributions from certain retirement plans. The additional tax is equal to 10% of the portion of the distribution that's includible in gross income. Generally, early distributions are those you receive from a qualified retirement plan or deferred annuity contract before reaching age 59½. The term qualified retirement plan means:
A qualified employee plan under section 401(a), such as a section 401(k) plan
A qualified employee annuity plan under section 403(a)
A tax-sheltered annuity plan under section 403(b) for employees of public schools or tax-exempt organizations, or
An individual retirement account under section 408(a) or an individual retirement annuity under section 408(b) (IRAs)
your foreign pension would not be a qualified plan and tthus no early withdrawl penalty.
