Retirement Plan Early Distribution

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Generally, if you withdraw funds from a tax-deferred retirement account and have not reached age 59 1/2, your withdrawal will be subject to a 10% penalty on the amount withdrawn. In addition to paying income taxes at the federal level, you may have to pay state taxes. There may also be a state penalty on an early withdrawal. State taxes are not considered in this example.

Whenever possible, it's generally best to avoid paying early withdrawal penalties on retirement assets. How much of your retirement nest egg would be lost to taxes and penalties if you took an early withdrawal? Note that this example assumes that the account is funded with pre-tax or tax-deductible contributions, and that withdrawn amounts are taxable.

Total taxes and penalties are estimated to be $0.00. After taxes and penalties, the amount remaining will be $0.00.

There are certain exceptions to the penalty imposed on an early withdrawal. However, income taxes must still be paid. Consult your tax advisor before taking any action.

Distribution Potentially Lost to Penalties and Taxes