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Are there exceptions to the early distribution penalty on an IRA?

by TurboTax Updated 2 months ago

Unless you qualify for an exception, you’ll pay a 10% additional tax penalty on the taxable amount of early distributions from an IRA (traditional or Roth) before reaching age 59 1/2.

There are exceptions to the 10% tax penalty for early distributions:

  • Death or total and permanent disability
  • Series of substantially equal periodic payments based on life expectancy
  • Qualified first-time homebuyer distributions up to $10,000
  • Qualified higher-education expenses
  • Certain medical insurance premiums paid while unemployed
  • Unreimbursed medical expenses that are more than a certain amount of your adjusted gross income
  • IRS levy
  • Certain distributions to qualified military reservists called to active duty
  • Beneficiary of a deceased IRA Owner
  • Qualified Birth or Adoption costs

Once you enter the distribution information from your 1099-R form, we'll help you check for any exceptions that could reduce the tax.

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