The rules surrounding IRAs, 401(k)s, and other retirement accounts can be very complicated and can snare even the smartest of lawyers, financial advisors, and accountants. When trying to avoid the penalties and taxes on taking an early withdrawal from a traditional IRA or 401(k) account before the age of 59 ½ it is important to understand the exceptions. This article discusses the 11 separate exceptions for early withdrawals that people need to be aware of and careful when using. It is also extremely important to keep beneficiary forms up to date and avoid any of the “death traps” discussed in this article when passing on assets to loved ones. This column also discusses the “stretch IRA” and the debates taking place among lawmakers about its future.
See Janet Novack, Retirement Account Mistakes – Not For Dummies, Forbes, November 15, 2015.
Special thanks to Brian Cohan (Attorney at Law, Law Offices of Brian J. Cohan, P.C.) for bringing this article to my attention.
