Details of IRA Distributions

Understanding how IRA distributions work can help you avoid any confusion when it comes to your retirement funds. Here are the basics of IRA distributions.

IRA Distributions

When you contribute money to an IRA, the money is allowed to grow tax-free in the account until you start taking distributions. You are eligible to start taking distributions from the account once you reach the age of 59 1/2. At that point, you can start taking distributions without paying any penalties. The money that you take out at this point will be taxed as if it were regular income.

Early Distributions

Generally, if you take out money from your IRA before you reach the age of 59 1/2, you will be forced to pay a 10% early distribution penalty. In addition to paying this penalty, you will have to pay income tax on the money. Therefore, it is best to allow the funds to stay in your account until you reach 59 1/2.


If you can prove that you have some type of hardship, you may be able to take out the funds without paying a penalty. For example, if you have to pay excessive medical bills or funeral costs, this might qualify as a hardship.

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