What are the exceptions to the penalty for an early withdrawal from my 401(k)?
If you took a distribution from your 401(k) or another qualified retirement plan before you turned 59 1/2, you'll pay a 10% early withdrawal penalty, with a few exceptions:
- Death, or total and permanent disability
- Qualified Domestic Relations Order
- Series of substantially equal periodic payments based on life expectancy
- Dividend pass through from an ESOP
- IRS levy
- Unreimbursed medical expenses that are more a certain amount of your adjusted gross income.
- Certain distributions to qualified military reservists called to active duty
- Separation from Service
Once you enter the distribution information from your 1099-R form, we'll help you check for any exceptions that could reduce the tax.