Retirement Account Early Withdrawal Penalty Calculator
Calculate your 401(k) or IRA early withdrawal penalty for 2026 and check which exceptions might apply to you.
Take money out of a 401(k) or IRA before age 59½ and you'll usually owe a 10% penalty on top of regular income tax. Some exceptions remove the penalty. Disability and large medical bills qualify for any account. The first-time home purchase exception works only for IRAs, and the Rule of 55 only for employer plans. SECURE 2.0 added newer ones, such as a $1,000 emergency withdrawal.
Check the exceptions before you take the money out. Several of them work for an IRA but not a 401(k), or the other way around, and picking the wrong account can cost you the penalty. Enter your age, the account and the amount to see what you'd owe.
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Your Early Withdrawal Penalty Result
Reminder: exceptions waive the 10% penalty only. The distribution is still taxable as ordinary income in almost all cases, exception or not.
The Rule of 55 applies only to employer plans, never IRAs. First-time home purchase and higher education exceptions apply only to IRAs, never employer plans. If you mix them up, you'll pay the 10% penalty.
Here's what an early withdrawal really costs. Say you're 50, in the 22% federal bracket, and you take $20,000 from a 401(k). The penalty is $2,000 and federal income tax is about $4,400, so roughly $6,400 is gone before any state tax, and you keep about $13,600. The plan also has to withhold 20% ($4,000) when it pays you, and the rest gets settled when you file.
Some exceptions work for any account: total disability, death, terminal illness, unreimbursed medical bills above 7.5% of your income, and an IRS levy on the account. Others depend on the account type. The Rule of 55 covers only the 401(k) or similar plan at the job you leave in or after the year you turn 55 (50 for many public safety workers). It never covers an IRA. First-time home purchases (up to $10,000 lifetime) and college costs are the reverse: IRA only.
SECURE 2.0 has added more exceptions since 2024. You can take $1,000 a year for a personal emergency by certifying it yourself, but you can't take another for three years unless you pay the first one back. Survivors of domestic abuse can take up to $10,000, adjusted for inflation. There are also exceptions for federally declared disasters and terminal illness. None of these exceptions remove income tax. A withdrawal from a pre-tax account is taxable in the year you take it.
Frequently Asked Questions
What is the early withdrawal penalty on a 401(k) or IRA?
It's a 10% additional tax on money taken out before age 59½. You pay regular income tax on the withdrawal too, so a $10,000 withdrawal costs $1,000 in penalty plus tax at your bracket.
What is the Rule of 55?
If you leave a job in or after the year you turn 55, you can take money from that employer's 401(k) without the penalty. It doesn't matter whether you quit, retired or were laid off. It covers only the plan at the job you left, not 401(k)s from earlier jobs and not IRAs. If you roll the money into an IRA first, you lose the exception.
Can I avoid the penalty for a first-time home purchase?
Yes, from an IRA, up to $10,000 over your lifetime. "First-time" means you haven't owned a main home in the past two years. The exception doesn't cover 401(k) withdrawals.
Do exceptions to the 10% penalty also waive income tax?
No. They remove the 10% penalty only. The withdrawal is still taxed as ordinary income unless it comes from Roth contributions or a qualified Roth distribution.
What new penalty-free withdrawal options did SECURE 2.0 add?
The main ones are a $1,000-a-year emergency withdrawal, up to $10,000 (indexed for inflation) for domestic abuse survivors, withdrawals for terminal illness, and up to $22,000 after a federally declared disaster.
How much can I withdraw penalty-free for an emergency?
$1,000 per calendar year, from an IRA or from an employer plan that allows it. You certify the emergency yourself, without paperwork. If you don't repay it, you can't take another emergency withdrawal for three years.
This estimate follows IRC §72(t) and current SECURE 2.0 rules. It isn't tax or financial advice. Each exception has documentation requirements and dollar limits that this tool doesn't fully cover, so talk to a tax professional before you take money out early.