401K Penalty Free Withdrawal
Many aspects of a specific plan 401K plan are governed by specific rules. You should contact your plan administrator particular rules for your plan.
Generally speaking, IRS enters 10% penalty for withdrawals from 401K plans for taxpayers under age 59 1 / 2. However, according to the IRS, in the following situations are exceptions:
401k withdrawal. General exceptions: 10% penalty does not apply to distributions that:
1 - Made as part of a series of substantially equal periodic payments (not less than one year) for his life (or lives) or the joint lives (or joint life expectancies) of you and your designated beneficiary (if from a qualified pension, payments must begin after separation from service).
2 - Made because you are totally and permanently disabled, or
3 - Made on or after the death of a participant of the plan or contract holder.
4 - from qualified pension benefits (except IRA), after separation from service or after the year you reach age 55
5 - from qualified pension benefits (except IRA) to an alternate recipient under a qualified domestic relations for,
6 - from qualified pension to the extent you have deductible medical expenses (medical expenses that exceed 7.5% of your adjusted gross income), or you do not list your deductions for the year
7 - from an employer plan under a written election that provides a specific timetable for the distribution of your interests, if on March 1, 1986, you are dismissed and began receiving payments in accordance with the election
8 - from employee stock ownership plan for dividends on the securities held by the employer plan, or
9 - from qualified pension due to IRS collection plan.