The IRS “What Ifs” for Struggling Taxpayers – Job Related (A-4)

The IRS “What Ifs” for Struggling Taxpayers – Job Related (A-4)

What if I withdraw money from my IRA?
Generally, early withdrawal from an Individual Retirement Account (IRA) prior to age
59½ is subject to being included in gross income plus a 10 percent additional tax penalty.
There are exceptions to the 10 percent penalty, such as using IRA funds to pay your
medical insurance premium after a job loss. For more information, see  Hardships, Early
Withdrawals and Loans on the IRS web site.

What if my 401(k) drops in value?
Generally, you cannot claim a capital gains loss on your retirement accounts that
already are receiving favorable tax treatment. The only time you would have a loss is
when you receive a distribution that had previously been taxed. For more information,
see  About Publication 575, Pension and Annuity Income .
 
(IRS Web Site Updated 3/28/22) (TTT 06/28/22)