How much is the penalty for early withdrawal on an IRA?
Withdrawals prior to age 59.5 are taxed as ordinary income and have a 10% penalty for the entire amount of the distribution. If your intent is to withdraw a lump sum for an emergency or single expense, you may wish to consider another source for the funds. If your intent is to begin receiving a retirement income, IRS code 72(t) allows you to distribute your qualified retirement plan in “substantially equal payments” without penalty. Most financial advisors and planners can calculate the income stream and will do so at no charge.
