Avoid excessive tax penalties
Because of the beneficial tax-deferred status of retirement accounts, the government places guidelines on when you can start taking distributions and when you must take them. By staying within these guidelines, you can avoid the large tax penalties associated with them, including:
- 10% early withdrawal penalty assessed against any withdrawals made from a qualified retirement account before the account holder turns age 59½.1
- 50% penalty for not taking the Required Minimum Distribution after age 70½ (penalty applies to all undistributed amounts under the required minimum amount).
1 The 10% early withdrawal penalty does not apply to 457 plan withdrawals.
Empower Retirement is not responsible for, nor does it endorse the content contained in the additional Web sites provided. These Web sites are for general education and information only and are provided as a benefit to the users of the site.
For more information about taxes and Social Security benefit payments,
visit the Internal Revenue Service.
