Is paying for a parents expenses considered a reason for early withdrawl of IRA

[DianeW777]

No, this is not one of the exceptions to the penalty for early withdrawal of your IRA.  The exceptions are listed in detail in the instructions for Form 5329.

• Instructions Form 5329

Specific for IRAs:

• 07 IRA distributions made to certain unemployed individuals for health insurance premiums.
• 08 IRA distributions made for qualified higher education expenses.
• 09 IRA distributions made for the purchase of a first home, up to $10,000.
• 10 Qualified retirement plan distributions made due to an IRS levy.
• 11 Qualified distributions to reservists while serving on active duty for at least 180 days.
• 12 Other (see Other next). Also, enter this code if more than one exception applies.

[Opus 17]

Generally, no. However, there is a narrow set of circumstances where you could be exempt from the penalty.

1. The exemption to the penalty only applies to money withdrawn for medical expenses, not to money withdrawn for other living expenses.

2. You must be able to deduct your parent’s medical expenses on your tax return. You can do this if you can claim them as dependents, or if you can’t claim them as dependents but you paid more than half of their total living expenses, including household and medical expenses.

3. Your total itemized medical expense deduction is more than 7.5% of your adjusted gross income.  This is the threshold to deduct medical expenses as an itemized deduction on schedule A. 

If your total medical expenses that you list on schedule A are more than 7.5% of your adjusted gross income, the amount over that floor is your tax deduction. That amount is also the amount that you could withdraw from an IRA and not pay the 10% early withdrawal penalty.  And as described, in some cases you can deduct your parent’s medical expenses if you pay them.  But you don’t get an exception for paying general living expenses. The exception is based on what you claim as deductible medical expenses on your tax return.

And of course, all withdrawals from a traditional IRA or subject to regular income tax even if you are exempt from the 10% penalty.