Under the new SECURE 2.0 Act, you can now withdraw up to $1,000 from your retirement accounts, such as 401(k)s and IRAs, without incurring the usual 10% early withdrawal penalty. This change is designed to help individuals access emergency funds more easily during tough economic times.
However, it’s important to note that while the penalty is waived, you will still need to pay ordinary income taxes on the amount withdrawn.
Sources:
www.marketplace.org/2024/07/22/its-easier-now-to-pull-emergency-money-from-a-retirement-account/
www.kiplinger.com/taxes/new-early-withdrawal-tax-rules
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