Top Three IRA Withdrawal Penalty Exceptions

If you need money quickly and have an influx of cash in your ira account, you might be able to borrow the money from yourself without a penalty. There are currently three top reasons that the US government won’t charge you the ten percent tax penalty if you remove money from your account prior to age 59 1/2. These reasons are health, education, and first time home buyers. If you need cash for these circumstances this might provide you with the funds needed.

There are many reasons that you might need funds for medical purposes. If you become disabled and your doctor deems that you can no longer work would provide you with one such reason. Another is if you or family members incur medical bills that are greater than seven and a half of your adjusted gross income you qualify for penalty free ira withdrawals. And the ultimate reason could be death. If you have a fatal illness in which case you would die prior to age 59 1/2 you can disperse funds from your ira account to your beneficiaries without any penalties.

If you dream of owning a home and this is your first purchase, you would qualify for one of several ira withdrawal penalty exceptions. The funds can be used to purchase, build or rebuild your first home. The maximum amount that you can withdraw is $10,000. You can even withdraw the funds after you’ve purchased your home, but it must be done within 120 days of purchase.

Higher education is now within your grasp. You don’t have to worry about suffering from high interest fees from school loans if you use money from your ira account. If the company you work for won’t reimburse you for your degree you can pay for it yourself to get the education you need to advance yourself. The is the last exception for ira withdrawal.

Remember that these are the top three reasons that you won’t have to incur the ira withdrawal penalty. There are others that may want to learn more about. As with any major financial decision make sure that you speak with a financial advisor to fully understand the repercussions of your decision.

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Jul201029

mr. pink

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