Traditional IRA, SEP, SIMPLE and Solo 401(k) account holders must begin taking required minimum distributions (RMD) from their accounts beginning April 1st of the year following reaching age 70 ½.
RMD is calculated by special formula relating to life expectancy; please consult with IRS Publication 590 and/or a tax consultant. RMDs are calculated for each account, which means if you have multiple accounts you are required to take distributions from each account.
Special Note on Premature Distributions
You can generally withdraw funds from a Traditional or Roth IRA without penalty at any time after you have attained the age of 59 ½. If you decided to withdraw money from your Traditional or Roth IRA account prior to reaching age 59 ½ you will be subject a 10% early distribution penalty tax (with the Roth IRA, you can withdraw any contribution as long as it has been in the account for 5 years).
Are there exceptions to the 10% early distribution penalty tax?
Yes, there are several exceptions to the 10% early distribution penalty tax. Among the exceptions recognized under the Internal Revenue Code are the distributions due to the following events: