What Is the Irs Penalty for Early Withdrawal of Your Retirement?
Withdrawals are subject to income tax and prior to age 59-1/2 may also be subject to a 10% additional tax penalty. There are some exceptions to the penalty. Consult a tax advisor for more information. For this calculation we assume that all contributions to the retirement account were made on a pre-tax or tax deductible basis.
What happens if I withdraw money from my 401k early?
Participants in a traditional or Roth 401 (k) plan are not allowed to withdraw their funds until they reach age 59½. If you withdraw funds early from a 401 (k) you will be charged a 10% penalty tax, plus your tax rate on the amount you withdraw. In short, if you withdraw retirement funds early, the money will be treated as income.
