Early withdrawal penalty


Also found in: Acronyms.

Early withdrawal penalty

Penalty paid by the holder of a fixed-term investment penalizing an investor who withdraws money before the agreed-upon maturity date.

Early Withdrawal Penalty

A fee assessed on the withdrawal of funds from a fixed-income investment before the prescribed time. Early withdrawal may come from a certificate of deposit before its maturity. More often, however, early withdrawals refer to withdrawals from a retirement account before the appropriate age (usually 65 or date of retirement, whichever is greater). Early withdrawal penalties exist to discourage the frequent or abusive use of early withdrawals. As a result, early withdrawals usually occur when the account holder is in great financial need.
References in periodicals archive ?
Therefore, he can avoid the 10% early withdrawal penalty on the conversion contribution after January 1, 2024, even though he will only be age 47 then.
That year-of-death distribution would not trigger the early withdrawal penalty, even if Gino is 55, but any other withdrawals before Gino reaches age 594 could be subject to it.
The firm's "2014 Early CD Withdrawal Penalties Survey" measured early withdrawal penalty policies on 3-month, 6-month, 1-year, 2-year and 5-year CDs from May 5-14, 2014, at the top 10 banks and thrifts in the 10 largest U.S.
The Roth is more attractive if workers anticipate a possible withdrawal before age 591/2, since Roth principal is exempt from the 10 percent early withdrawal penalty that applies to before-tax contributions.
Further, the court found that the employee was liable for the early withdrawal penalty because the loans were transferred out of his IRA before he reached age 59 1/2.
If the employee is under the age of 59.5, there is an additional 10 percent early withdrawal penalty.
Customers may withdraw their money from any account that's been transferred to Home Federal without an early withdrawal penalty until they enter into a new deposit agreement with Home Federal, as long as the deposits haven't been put up as collateral for loans.
Otherwise, it is included in the taxpayer's gross income and may be subject to the 10% early withdrawal penalty of IRC [section] 72(t).
early withdrawal penalty because Phillip is disabled
Tax rules for distributions diverge for traditional and Roth IRAs, but both types are generally subject to a 10 percent early withdrawal penalty, with some exceptions.
If the former employees want to tap into that money, they have to pay an early withdrawal penalty if they have not reached retirement age -- up to 10%, in most cases.
If a surviving spouse takes the death benefits inherited from the deceased spouse and rolls the funds over into her own IRA, then these rolled over funds cease to qualify for the 10% early withdrawal penalty exclusion based on the first spouse's death.

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