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>> I've asked a few seasoned tax pros about it - because i couldn't come up with anything that would satisfy my ILs immediately* - and they all agreed with whatever someone told BIL and SIL in the first place: No dice. <<

*Immediately*? No, not without punitive taxes and penalties. But they can get their portion rolled over into a separate IRA, and it would be up to them as to whether or not they wanted to let it grow or tap it now (with taxes -- and interest if Rule 72t isn't used).

If she's not at least 59.5 years old, the only way to get anything out of her share penalty-free is to use Rule 72t as already mentioned. Anything more than that would be subject to taxes AND the 10% penalty.

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