Yes, but the taxable portion of your distribution may be subject to a 10% penalty for early withdrawal if you're not yet age 59½. If you are 59½ or older and take money from your traditional IRA, you will not be assessed a penalty, though you may still have to pay income tax on all or part of the distribution. The purpose of the premature withdrawal penalty is to discourage you from exhausting your IRA savings too soon. However, the penalty can be a significant drawback if you need money to meet unexpected expenses.

If you are experiencing a cash crunch, it's usually better to draw on other investments before dipping into your IRA. However, if your IRA is your only sizable asset, you may have no choice. If that's the case, be aware that there are a number of exceptions to the premature distribution rule.

If you are disabled, you are exempt from the penalty, as long as you meet the IRS definition of disability. If an IRA owner dies before reaching age 59½, and you are a beneficiary of the account, distributions that you receive are exempt. If you need supplementary income, you can take IRA distributions as a series of "substantially equal payments" over your life expectancy or the joint life expectancy of you and your beneficiary. These distributions may avoid the penalty as long as you don't modify the payments within certain time frames.

Subject to limits and conditions, the penalty generally will not apply to IRA distributions taken to pay qualifying medical expenses, health insurance premiums while you're unemployed, qualified higher education costs, costs associated with the birth or adoption of a child (up to $5,000), terminal illness (if a physician certifies it will cause death within seven years), expenses related to a federally declared disaster (up to $22,000), qualified first-time home-buyer expenses (up to $10,000 lifetime from all your IRAs), up to $1,000 per year for emergency expenses, up to $10,500 (in 2026) for victims of domestic abuse, and up to $2,600 (in 2026) for the purchase of a qualified long-term care insurance policy. It also does not apply to amounts rolled over from one IRA to another (assuming you follow the rules for rollovers), to conversions of traditional IRAs to Roth IRAs, to amounts that the IRS levies from your IRA to cover your tax bill, or to qualified reservist distributions. Other exceptions may also apply.

Qualified distributions from your Roth IRAs are federal income tax — and penalty tax — free. Distributions are qualified if you satisfy a five-year holding period, and you are (a) age 59½, (b) disabled, (c) deceased, or (d) you have qualified first time home-buyer expenses. The taxable portion of nonqualified distributions from your Roth IRAs is subject to the same 10% penalty rules that apply to traditional IRAs. (Special rules may apply if you take a nonqualified distribution from your Roth IRA within five years of a conversion.)

Finally, education IRAs may be subject to special rules of their own.

This content has been reviewed by FINRA.
Prepared by Broadridge Advisor Solutions. © 2026 Broadridge Financial Services, Inc.

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5/13/26