401K and 72t

[tomz]

I've been searching the archives, but haven't found an answer to my question, which is this:

Thanks to this fourm, I know if you want to withdraw funds from an IRA before 59 1/2 without penalty, you have to follow the 72t rules.

However, if you withdraw funds from a 401K after you retire from the company sponsoring the 401K and are over 55 but less than 59 1/2, do the 72t rules apply or can you do penalty-free withdrawals in the same way you would if you were 59 1/2?

Thanks in advance.

TomZ

[brewer12345]

AFAIK, you can pull money penalty free out of a 401k as long as you are over 55.

[frayne]

Quote:

Originally Posted by brewer12345 AFAIK, you can pull money penalty free out of a 401k as long as you are over 55.

I think there is also a stipulation that you had to quit work in the place where you had your 401K during the year you turned 55.

[tomz]

Thanks for the replies.* I called JP Morgan, who manages my 401K.* The customer service kid who answered said I could withdraw without penalty before 59 1/2 and it would be just like a regular withdrawal not a 72t.* I will be working at the company sponsoring the 401K when I hit 55.* He also told me that I should check with a tax advisor because there could be other circumstances where I would have to pay the penalty.* He said that 3 times.* I guess they have to be careful about how people interpret their answers to questions.* *

[Coach]

It's after separation from service, in or after the year you reach 55. IRS Pub 575 lays it out.

Coach

[maggieddd]

so can you withdraw from company sponsored 401K before you are 55 following 72t rules?

[tomz]

Quote:

Originally Posted by Coach It's after separation from service, in or after the year you reach 55. IRS Pub 575 lays it out. Coach

Thanks.* I checked out Pub 575 and it lays things out in fairly understandable terms.