A 10% penalty for taking distributions prior to age 59 ½.
- Waived if the distribution is from an account you inherited.
- No penalty for distributions of contributions to a Roth.
- Penalty will apply to a distribution of earnings, however.
- Avoided if you take a series of “substantially equal payments” from the IRA and maintain those annual distributions until age 59 ½ AND for at least a minimum of 5 years.