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Subject:  Re: Questions Date:  6/2/2001  7:55 AM
Author:  pmarti Number:  6851 of 20596

1) Just retired at age 55 - can I withdraw from my 401-K prior to 59-1/2, and not owe 10% penalty, but just pay income tax? (I understand that I WOULD owe 10% penalty if I rolled my 401-K into an IRA, and then attempted to withdraw from IRA prior to 59-1/2.) Answer to this will determine if I leave funds in company 401-K or roll into IRA.

Congratulations on your retirement. Yes, you can withdraw as you wish from your 401(k) without paying the premature distribution penalty. You can verify this in IRS Publication 575. Note that there's no problem from a tax standpoint. Your plan may restrict the ways you can take withdrawals.

Phil Marti
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