What are the limitations for an IRA withdrawal?

In many cases, withdrawals from a Traditional IRA before age 59½ are subject to a 10% IRS early withdrawal penalty in addition to any applicable income taxes. However, the IRS provides certain exceptions that may allow you to avoid the 10% penalty, such as qualifying first-time homebuyer expenses (up to $10,000 lifetime limit), certain education expenses, disability, or death.

 

If your IRA is an IRA Certificate, an early withdrawal may also result in a certificate early withdrawal penalty if funds are taken before the maturity date.

 

Because IRS rules and exceptions can be complex, we recommend consulting a qualified tax professional regarding your specific situation.