May I Avoid the Pre-59½ Withdrawal Penalty?

Yes. There is a way to take early income from your IRA without the 10% income tax penalty normally applied to withdrawals before age 59½. Section 72(t) of the Internal Revenue Code allows early payouts that meet these basic guidelines:

• Substantially equal payments must be taken at least annually; which are
• calculated on the life expectancy of the IRA owner or joint life expectancies of the owner and beneficiary; and
• the form of payment may not be modified before the IRA owner attains age 59½ or five years have elapsed since the payments began, whichever is later.

You may use LSWs customized withdrawal plan or one of several annuity payout options to qualify your withdrawal under Sec. 72(t).

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Updated: Monday, December 03, 2007 11:52:46 PM  Eastern