Accounts & CustomersQuestion 66 of 125
A withdrawal from a traditional IRA before age 59 1/2 is generally subject to:
a.No tax and no penalty
b.A penalty only, with no income tax
c.Only state tax
d.Ordinary income tax plus a 10% early withdrawal penalty, unless an exception applies
Explanation
Early distributions from a traditional IRA taken before age 59 1/2 are generally taxed as ordinary income and are also subject to a 10% penalty. Certain exceptions, such as qualified first-home purchases, higher education, or disability, may waive the penalty but not the ordinary income tax.
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