RMDs & IRAs

401(k) Early Withdrawal Penalty: 10% Plus Tax, Calculated

Taking money from a 401(k) before 59½ normally costs a 10% additional tax on top of regular income tax, or 25% from a SIMPLE IRA in its first two years. More than a dozen exceptions cancel the penalty. Enter the amount and pick an exception to see what you'd really pay.

IRS exceptions list Verified October 23, 2026

Your details

Amount you want to withdraw

$

Account

Does an exception apply?

Filing status

Your other taxable income this year

$

Wages and other income, to find your tax bracket.

Results update as you type. We don’t save what you enter; shared links keep it after the “#”, which never reaches our servers.

Early withdrawal penalty

$2,500

Plus about $5,500 of federal income tax — $8,000 in total on $25,000.

Penalty rate

10%

under 59½

Exempt from penalty

$0

You keep (before state tax)

$17,000

Left this job at 55 or later?

The Rule of 55 lets you take money from that employer’s plan with no 10% penalty — but only if you don’t roll it to an IRA first.

Show the math

The additional tax is 10% of the taxable amount withdrawn before 59½ (25% from a SIMPLE IRA in the first two years). Exceptions cover all or part of a withdrawal; several have dollar limits. Report the penalty and any exception on Form 5329. Income tax is estimated with 2026 brackets on top of the income you entered.

Next stepCheck the Rule of 55The most-missed exception for people retiring in their late 50s.

Email these results

Early Withdrawal Penalty Calculator: Check the Exceptions First

Before you count the penalty, check the exceptions. Some apply to 401(k)-type plans only, some to IRAs only, and several have dollar limits. (IRS: exceptions to tax on early distributions)

Exception	401(k)	IRA	Limit
Left job in or after the year you turned 55	Yes	No	—
Disability or terminal illness	Yes	Yes	—
Substantially equal periodic payments	Yes	Yes	—
Medical bills above 7.5% of AGI	Yes	Yes	the excess
Emergency personal expense	Yes	Yes	$1,000 a year
Birth or adoption	Yes	Yes	$5,000 per child
Domestic abuse victim	Yes	Yes	$10,000 or 50%
Federally declared disaster	Yes	Yes	$22,000
First home	No	Yes	$10,000 lifetime
Higher education	No	Yes	—

Man in his fifties thinking by an office window — Photo: Andrea Piacquadio / Pexels

What does an early withdrawal really cost?

Add the penalty to your income tax. A $25,000 withdrawal for someone in the 22% bracket costs $2,500 in penalty and about $5,500 in federal tax — $8,000, or 32%, before any state tax. The calculator works it out from your own income.

Better options to check first

A 401(k) loan avoids tax and penalty if you repay on schedule — generally up to the lesser of $50,000 or half your vested balance. If you've already left the job at 55 or later, the Rule of 55 may cover you, and the withdrawal tax calculator shows what you'd keep (IRS Topic 413).

Glass jar of savings labeled as an emergency fund — Photo: https://kaboompics.com/ / Pexels

Our take: the penalty is the smallest cost

Ten percent hurts, but the bigger losses are the tax and the decades of growth that money won't have. Use early withdrawals for real emergencies, and test what's left with the how long will my money last calculator.

Frequently asked questions

Can I take my Roth IRA contributions out early?

Yes. Contributions (not earnings) to a Roth IRA can come out at any time, tax- and penalty-free. Earnings withdrawn early can be taxed and penalized.

Is a hardship withdrawal penalty-free?

No. A hardship withdrawal lets you take money out of the plan, but it still owes the 10% penalty unless one of the IRS exceptions also applies.

How do I claim an exception?

Your plan may code the 1099-R correctly. If it doesn't, claim the exception on Form 5329 with your tax return.

What are the rules for substantially equal payments?

Once started, the payments must continue unchanged for five years or until 59½, whichever is later. Changing them early brings back the penalty on everything already withdrawn, plus interest.

Sources

Primary sources only. We re-check them whenever an agency publishes new figures.

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Where people go next

Rule of 55 CalculatorCheck whether the Rule of 55 lets you take 401(k) money penalty-free, and the penalty you avoid.Open 401(k) Withdrawal Tax CalculatorWhat you keep from a 401(k) or IRA withdrawal after federal tax, withholding and any penalty.Open Retirement Tax CalculatorYour 2026 federal tax on Social Security, pensions, IRA withdrawals and investments.Open