Take money out of a US IRA or 401(k) before age 59½ and a 10% additional tax comes on top of regular income tax. IRS Topic no. 557 says the 10% applies to the part of the distribution you must include in gross income and is in addition to regular income tax. From a SIMPLE IRA within the first 2 years of participation it is 25%, and governmental 457(b) plans are not subject to it except for amounts rolled in from other plans or IRAs. There are more than 20 exceptions, and they differ by account type. Below is the IRS exceptions table and a calculator that works out the additional tax from the amount, the exception and your bracket.
1. Before 59½: taxable part × 10% — 25% from a SIMPLE IRA in the first 2 years.
2. Exceptions depend on the account — separation at 55 is for plans like a 401(k) only; first home $10,000, higher education and health premiums while unemployed are for IRAs only.
3. If you qualify but box 7 of Form 1099-R shows no exception code, claim it on Form 5329.
Calculator
Updates as you type. The additional tax is the rate times the taxable part not covered by an exception. Caps are applied the way the IRS table states them; lifetime or per-year use of a cap, and whether you qualify, are not checked. The income tax line is our estimate at one bracket, not a tax return.
What it applies to — IRS Topic no. 557
| Type | What the source says | Worth noting (ours) |
|---|---|---|
| Who | IRA distributions before 59½ (early distributions) | Traditional and Roth IRAs |
| Amount | 10% of the part you must include in gross income | For a Roth IRA, only the taxable part (see the Roth page) |
| Nature | In addition to regular income tax | It doesn’t replace income tax |
| Rollovers | Not due when rolled over or transferred — if you follow the one IRA-to-IRA rollover per year rule | Different from a direct transfer |
Rates — footnotes to the IRS table
| Type | What the source says | Worth noting (ours) |
|---|---|---|
| General | 10% on early distributions from qualified plans, 403(a) and (b) annuities and traditional IRAs, including those tied to a SIMPLE IRA or SEP | Qualified plans include defined benefit, cash balance, 401(k) and profit-sharing plans |
| SIMPLE IRA | Within the first 2 years of participation: 25% instead of 10% | Same account, different rate by timing |
| Governmental 457(b) | Not subject — except distributions of amounts rolled in from another type of plan or IRA | The calculator uses 0% |
23 exceptions — the IRS table
From the IRS page “Retirement topics — Exceptions to tax on early distributions”, reordered. “Both” means qualified plans such as a 401(k) and IRAs (including SEP, SIMPLE IRA and SARSEP).
| Exception | What the IRS table says | Where (plan · IRA) |
|---|---|---|
| Age 59½ | After the participant or IRA owner reaches 59½ | Both · 72(t)(2)(A)(i) |
| Death | After the death of the participant or IRA owner | Both |
| Disability | Total and permanent disability | Both |
| Terminal illness | Paid on or after the date a physician certifies a terminal illness | Table: plans yes, IRA n/a. Topic 557 and Pub 590-B list it for IRAs |
| Equal payments | A series of substantially equal payments (SEPP) | Both. Topic 557: life or life expectancy; Notice 2022-6 |
| Separation at 55 | Leaving the job during or after the year you reach 55 (50 for state or local public safety employees) | Plans only — not IRAs |
| IRS levy | Paid because of an IRS levy on the plan | Both |
| Divorce | To an alternate payee under a QDRO | Plans only |
| Medical | Unreimbursed medical expenses over 7.5% of AGI | Both |
| Health premiums while unemployed | Family health insurance paid by someone who received unemployment compensation for 12 weeks | IRAs only |
| Education | Qualified higher education expenses | IRAs only |
| First home | Qualified first-time homebuyers, up to $10,000 | IRAs only |
| Birth or adoption | Up to $5,000 per child | Both |
| Reservists | Certain distributions to reservists called to active duty | Both |
| Disaster | Economic loss from a federally declared disaster, up to $22,000 | Both |
| Domestic abuse | A victim of abuse by a spouse or domestic partner, up to the lesser of $10,000 or 50% of the account (after 31 December 2023) | Both |
| Emergency expense | One a calendar year, up to the lesser of $1,000 or the vested balance over $1,000 (after 31 December 2023) | Both |
| Emergency savings | From a pension-linked emergency savings account (after 31 December 2023) | Plans only |
| ESOP | Dividend pass-through from an ESOP | Plans only |
| Corrective | Timely corrective distributions of excess contributions or deferrals and earnings | Plans only |
| Returned IRA contributions | Withdrawn by the extended due date — not the earnings | IRAs only |
| Rollovers | Moved to another plan or IRA within 60 days; in-plan Roth rollovers | Both |
| Auto-enrolment | Permissive withdrawals from auto-enrolment plans | Plans; for IRAs only SIMPLE IRAs and SARSEPs |
The footnote says the age-50 rule also covers specified federal law enforcement, corrections and customs and border protection officers, federal firefighters, private-sector firefighters and air traffic controllers. The table also shows that moving 401(k) money into an IRA first loses the age-55 exception (our reading).
Five worked cases — our examples
| Case (our example) | Additional tax | Worth noting (our sum) |
|---|---|---|
| Traditional IRA $20,000, all taxable, no exception, 22% bracket | $2,000 | With $4,400 income tax, $6,400 federal |
| SIMPLE IRA within 2 years, $20,000 | $5,000 | 25% |
| Traditional IRA $20,000, first home | $1,000 | $10,000 out; 10% of the other $10,000 |
| 401(k) $30,000, left the job in the year turning 55 | $0 | Rolled into an IRA first: $3,000 |
| IRA $15,000, domestic abuse victim, balance $16,000 | $700 | Cap = lesser of $10,000 and $8,000 (50%); 10% of the remaining $7,000 |
How it’s reported — Topic no. 557
The 10% goes on Form 5329 and Schedule 2 (Form 1040). If box 7 of Form 1099-R shows code 1, you can skip Form 5329, enter the tax on Schedule 2 and tick the box saying you aren’t liable to file Form 5329. If you qualify for an exception but the 1099-R shows none, or the wrong one, use Form 5329 to show the right one.
These US additional taxes apply to US taxpayers (citizens, green-card holders and US tax residents). If you live in Korea with a US account, the Korea–US tax treaty and Korean tax law also come in, so don’t rely on this arithmetic alone (our note).
Account types and limits are in US IRA; 401(k) basics are in US 401(k).
Checklist
- ☐ Were you 59½ on the day of the withdrawal?
- ☐ Plan (401(k)) or IRA — the exceptions differ
- ☐ SIMPLE IRA: past 2 years of participation? (25%)
- ☐ Anything above a cap ($10,000, $5,000, $22,000, $1,000)?
- ☐ Check box 7 of Form 1099-R; if no code, Form 5329
Questions that remain
Is a Roth IRA withdrawal also 10%?
Topic 557 covers traditional and Roth IRAs, but the tax applies only to the part included in income. Roth IRAs have ordering rules that pay out contributions first — see the Roth IRA five-year rule checker.
Is terminal illness an exception for IRAs?
The IRS exceptions table (updated 11 December 2025) shows “n/a” in the IRA column and cites a 401(k) provision, while Topic 557 (updated 26 October 2026) and Pub 590-B list terminal illness among IRA exceptions. Because the pages differ, the calculator groups death, disability and terminal illness and treats them as exceptions for both (our choice).
Do the caps rise each year?
The table gives $10,000, $5,000, $22,000 and $1,000 as fixed figures. Whether any is indexed isn’t on the pages we read.
Sources
- IRS — Retirement topics — Exceptions to tax on early distributions — source (Page Last Reviewed or Updated 11 December 2025; checked 5 November 2026). The 23 exceptions by plan and IRA, Code sections, who the 10% applies to, the 25% SIMPLE IRA rate, governmental 457(b), the age-50 public safety rule.
- IRS — Topic no. 557, Additional tax on early distributions from traditional and Roth IRAs — source (Page Last Reviewed or Updated 26 October 2026; checked 5 November 2026). What the 10% applies to, the one-rollover-a-year rule, the IRA exception list (incl. terminal illness), Form 5329, Schedule 2, code 1.
- Not read. IRC section 72(t) itself, Notices 2022-6 and 2024-55, Form 5329 instructions, the Korea–US treaty.
- What we added. The “worth noting” column and the Korean everyday gloss.
Where to check further
- IRS Publication 590-B — IRA distributions in full.
- A US tax professional (CPA or EA) — and the treaty if you live in Korea.
Written on 5 November 2026. The content is from the source; the glosses are ours.
