How to Make Withdrawals From an IRA Account

There are restrictions to consider when withdrawing funds from your IRA account if you want to avoid paying penalties. There are some basic guidelines and IRA withdrawal rules listed in this article; however, it's best to speak with your financial advisor before considering withdrawing from any retirement savings plan. Read on to learn how to make withdrawals from an IRA account.

Instructions

1. Wait until you are 59 1/2 years of age before you decide to withdraw funds from an IRA, and it must have been open for at least five years. If you don't follow the IRA withdrawal rules, you may have to pay a 10 percent penalty, plus possible income taxes.

2. Check to see if you have out of pocket medical expenses that amount to more than 7.5 percent of your adjusted gross income. If so, you may be able to withdraw from your IRA, before the age of 59 1/2 without the 10 percent penalty. Other exemptions include paying for medical insurance in the event that you lose your job and withdrawing funds if you become disabled.

3. Pay expenses for higher education during the year with funds withdrawn from your IRA, and you may be able to avoid penalties for all or part of it. In addition, if you are buying or building a first home, you may qualify for up to a $10,000 distribution free of penalties.

4. Look forward to taking your first withdrawal from your IRA during the year that you reach 70 1/2 years of age. After that time, you are required to withdraw at least the required minimum withdrawal amount by December 31 every year.

5. Talk with your banker or investment specialist about how to calculate minimum withdrawals, and discuss all of the IRA rules before you reach the age of 70 1/2 so you'll be aware of all of the options and requirements. If you don't have a good understanding, you stand a chance of having to pay income taxes and penalties, so talk with an advisor when the time approaches to take full advantage of your IRA savings account.