The minimum age to begin taking withdrawals from a traditional IRA is 59 1/2 years old, advises the Internal Revenue Service. Minimum withdrawals are mandatory when individuals are 70 1/2 years old, even if they are not yet retired.Continue Reading
Prior to reaching the minimum distribution age, individuals may take distributions from their IRA, but pay a penalty tax of 10 percent in addition to paying income tax on the withdrawal, notes the IRS. Individuals with a SIMPLE IRA are charged a tax penalty of 25 percent if they withdraw funds within the first two years of opening the account.
Individuals can withdraw money from an IRA before reaching 59 1/2 years old without paying a penalty tax if the funds are used for higher education costs or toward the purchase of the individual's first home, states Bankrate. Eligible schooling costs include tuition, fees, books and supplies. Individuals enrolled in college at least part-time may also use the money for room and board expenses.
Military reserve service members can take early distributions without paying the penalty tax if they were called to active duty after September 11, 2001 for a period of at least 179 days, advises Bankrate. The tax penalty may also be waived in certain hardship situations, such as becoming permanently and totally disabled.
Roth IRA accounts have different rules and withdrawal policies than traditional IRAs, notes Bankrate.Learn more about Financial Planning