The general rule for tapping a 401(k) free of the 10% early-withdrawal penalty is that you must be at least age 59 1/2. But there are some early withdrawal exceptions to these rules.Various situations might qualify you for an exception to the IRA penalty tax on withdrawals taken before you reach age 59½. The three exceptions that relate only to IRAs are as follows. Any distribution that you take from the QRP, as long as you were at least 55 years of age when you left employment, will not be subjected to the 10% penalty, only ordinary income tax. Under the Age 55 Rule, you can start withdrawing from your 401(k) plan without fear of the 10% penalty. Employer-sponsored, tax-deferred retirement plans like 401(k)s and 403(b)s have rules about when you can access your funds. Under the Age 55 Rule, you are too young to qualify. As a general rule, if you withdraw funds before age 59 ½, you’ll trigger an IRS tax penalty of 10%.The good news is that there’s a way to take your distributions a few years early without incurring this penalty. 11.Reservists called to active duty for at least 179 days are not subject to the penalty. Example 2: You get laid off from your job at age 54 and don’t turn 55 until next year. This type of withdrawal will be taxed and it can also be subject to an early withdrawal penalty.. 72t is a tax strategy that allows you to take penalty free withdrawals from a 401k or an IRA before you are 59.5 in order to avoid the 10% early withdrawal penalty. Example 1: You leave your job at age 56. For example, if you left your employer at age 53, even if you are now age 55, distributions from your 401(k) with that employer would still be subject to the 10% penalty, unless you meet one of the other exceptions. This provision only applies to QRPs, not to IRAs. If you happen to be over age 55 when you leave employment, there is another exception that applies. But as with many rules, there is an exception. This can start at ANY age, you don’t need to be 55. 10.Public safety employees separated from service and over age 50 may make penalty-free withdrawals. The Seventh Circuit recently confirmed that a taxpayer who could have withdrawn funds penalty-free from his former employer’s qualified retirement plan under the age-55 exception was hit with the 10% early withdrawal penalty when he rolled over his retirement plan money into an IRA and then took an early withdrawal. Sometimes circumstances can force you to take money out of your traditional IRA earlier than you'd planned. 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