CHARLOTTE — You will usually face a penalty if you take money out of your retirement account early, however, there are at least three new exceptions that are starting in 2024, Action 9′s Jason Stoogenke says.
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First, if you’re the victim of domestic abuse, you may be able to take out as much as $10,000 from your retirement plan. You must withdraw the money within a year of the crime. You don’t have to provide proof, but you should make sure you have evidence in case of an audit.
Second, if you find out you have a terminal illness, you will need to show proof, but you can withdraw as much money as you want.
Third, if you encounter an emergency, such as financial hardship, that you didn’t see coming, you may be able to take out up to $1,000.
The withdrawals would still be taxable for the three scenarios, but you won’t have to pay an early withdrawal penalty.
Still, always run any of these by your tax professional first to make sure you qualify.
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