topic If I used some of my early IRA withdrawl to use for health insurance during an unpaid leave of absence at work, is that the same as using some of it while unemployed? in Retirement tax questions

If I used some of my early IRA withdrawl to use for health insurance during an unpaid leave of absence at work, is that the same as using some of it while unemployed?

dobbsdavid — Tue, 24 Feb 2026 07:44:57 GMT

Re: If I used some of my early IRA withdrawl to use for health insurance during an unpaid leave of absence at work, is that the same as using some of it while unemployed?

Bsch4477 — Sun, 15 Oct 2023 22:25:48 GMT

You will not have a penalty for early IRA withdrawal for payment of health insurance premiums but you will have to pay income tax on that withdrawal.

Re: If I used some of my early IRA withdrawl to use for health insurance during an unpaid leave of absence at work, is that the same as using some of it while unemployed?

dmertz — Sun, 15 Oct 2023 22:32:05 GMT

Regarding the medical-insurance exception to the 10% additonal tax on an early-distribution, IRS Pub 590-B says:

You won't have to pay the tax on these amounts if all of the following conditions
apply.
• You lost your job.
• You received unemployment compensation paid under any federal or state law for 12 consecutive weeks because you lost your job.
• You receive the distributions during either the year you received the unemployment compensation or the following year.
• You receive the distributions no later than 60 days after you have been reemployed.

"Lost your job" means that the employer considers you to have separated from service (are no longer an employee).