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Level 1
posted Apr 3, 2025 2:16:23 PM

Received Distribution from Retirement Plan Prior to 59 1/2 to pay for Student Loan. Do I need to pay the Penalty?

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1 Best answer
Expert Alumni
Apr 3, 2025 2:36:43 PM

Yes. You must pay an additional 10% early withdrawal tax unless an exception applies.

Exceptions to the 10% additional tax.

2 Replies
Expert Alumni
Apr 3, 2025 2:36:43 PM

Yes. You must pay an additional 10% early withdrawal tax unless an exception applies.

Exceptions to the 10% additional tax.

Level 15
Apr 3, 2025 3:23:25 PM

... and using the funds to pay a student loan is not an exception to the penalty.