Auckland, New Zealand (PressExposure) January 07, 2010 -- If an IRA account holder becomes permanently disabled or is encumbered with unexpected medical expenses, the IRA withdrawal penalties may be waived under certain circumstances. Ordinarily, the penalties or fines associated with early withdrawal from an IRA run at about ten percent. It may be expected that in situations such as permanent disability, severe medical expense, or death that IRA penalties might be waived. There are other circumstances, beyond such extremes, where you may withdraw IRA funds without facing a penalty.
An account holder can withdraw as much as ten thousand dollars toward a first time home purchase without IRA withdrawal penalties. Urgent educational expenses for a child, grandchild, or spouse may be withdrawn without fear of penalty. If an account holder has been without a job for twelve weeks or more, money may be withdrawn to pay medical insurance premiums. In addition, if the Internal Revenue Service has placed a levy against your wages, you may clear the tax liability with funds from your IRA and not expect to pay IRA withdrawal penalties.
It is important to note that these situations are special exemptions from facing a withdrawal penalty. The waiver of IRA withdrawal penalties is meant to help account holders in times of emergency and urgent need. These provisions should not be viewed as an indicator that it is advisable to withdraw IRA funds prematurely. The removal of hundreds of dollars from an Individual Retirement Account today could result in the loss of thousands of dollars of revenue down the road.