Dear Dan, I could use some cash but my only savings is in an IRA. I’m 55 and hear there is an exception to the 10% penalty for taking money out before 59½ once you reach age 55 but I cant find anything on that except for 401(k)s. Can I or can I not get money out of my IRA without penalty? -Sid
Dear Sid, The age 55 penalty exception only applies to qualified retirement plans such as 401(k)s and only to those who separate from service. There are other circumstances that allow for distributions from IRAs without penalty prior to age 59½. Many of these also apply to retirement plans but not all. Below are the 11 exceptions that have been on the books for years that apply to IRA accounts. Maybe one will apply to you.
You are the beneficiary of a deceased IRA owner. (Note: Surviving spouses under age 59½ that roll their deceased spouse’s IRA into their own IRA are NOT exempt from the 10% penalty unless one of the below applies.)
You are totally and permanently disabled. (Generally, a physician must determine that you cannot do ANY substantial gainful activity and your condition is expected to end in death or continue indefinitely.)
You have unreimburse …