Types of Plans
Question: If I retire or leave my employer for any reason (including due to being laid off) before I am age 59 1/2, can I withdraw my vested benefits under that employer's 401(k) plan, without having to pay a 10% additional tax? What if I were 55 or older when I separated from service with my employer? |
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Answer:
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Generally, unless an exception applies, a distribution of your benefits from a 401(k) plan before age 59 ½ is subject to the 10% additional tax on early distributions from retirement plans. See Publication 575, Pension and Annuity Income .
- For example, a distribution of your entire benefit under a 401(k) plan that is made after separation from service and age 55 is not subject to the 10% tax.
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Page Last Reviewed or Updated: December 01, 2008