- Rocket Dollar Knowledge Base
- Self-Directed IRA (Traditional, Roth, or Beneficiary)
- Contributions, Limits, and Distributions
Pricing, Products, and Refund Policy
FAQs and the Benefits of Self-Directing Retirement Accounts
Investing and Alternative Asset Classes
Self-Directed IRA (Traditional, Roth, or Beneficiary)
Self-Directed Solo 401(k) (Traditional or Roth)
- Self-Directed Solo 401(k) FAQs
- Opening a Rocket Dollar Self-Directed Solo 401(k) Account
- Structure of a Rocket Dollar Solo 401(k) Account
- Contributions and Contribution Limits
- IRS-Related Questions
- Rolling Over/Transferring Old Accounts
- Solo 401(k) Traditional Contributions
- Solo 401(k) Roth Contributions
- Solo 401(k) Loans
- Uncommon Questions
Self-Directing Retirement Compliance and Self Care
Partnering with Rocket Dollar
Fundraising with Rocket Dollar
Specific State Rules
Privacy, Security, Identity, and Fraud
What are the exceptions on penalties for early distributions/withdrawals?
Early withdrawal from IRA distribution exceptions are listed and explained below.
When you distribute money early from the IRA with an exception distribution, you still have to pay ordinary income taxes on it, but you don't have to incur a 10% penalty.
First Time Home Buyers (IRA only)
If you haven't owned a primary residence in the last 2 years, you can qualify as a "first-time home buyer" according to the IRS. This will allow you to distribute up to $10,000 from your IRA. You can also use your 401(k) if it is allowed in your plan documents.
Total and permanent disability of the participant/IRA owner
Education (IRA only)
You can distribute retirement savings to pay for qualified higher education expenses.
You have unreimbursed medical expenses that are more than 7.5% of your adjusted gross income, or 10% if under age 65.
An IRA can be distributed at death to a beneficiary or convert to an inherited IRA. Inherited IRAs force required minimum distributions on the beneficiary, as they are set based on the previous owner’s age, not your own.
To read more about possible distribution exceptions, visit the IRS Exceptions chart on distributions.