When can withdrawals be taken without penalty?
Withdraw penalty free without incurring 10% IRS premature-distribution penalty:
- Upon reaching age 59 1/2
- Qualified educational expenses
- First time home purchase (lifetime maximum of $10,000 per individual)
- Catastrophic medical expenses
- Payment to beneficiaries upon the owner’s death
- Payment of health insurance premiums while unemployed for 12 weeks or longer
- Withdrawal of earnings and deductible contributions still results in taxable income.
- Regular contributions can be withdrawn tax and penalty free anytime
- Earnings can be withdrawn penalty free for any of the following qualified reasons:
- Age 59 1/2
- For first time home purchase (lifetime maximum of $10,000 per owner)
- Education Expenses
- Large medical expense and health insurance premium while unemployed