Rules apply to almost everything, from crossing the streets, returning a product and even when it comes to your IRA account. Aside from the policies and requirements that you have to meet when setting up your checkbook IRA, you also have to make it a point to familiarize yourself with the really important IRA withdrawal rules to avoid being penalized. You can always do your research online, since there are so many reliable sources that you will find on the internet, of course, if you want to really speak to experts, then IRA custodians and specialists are definitely the right people to contact.
What Are the IRA Withdrawal Rules that You Need to Know?
Now, after opening your own self-directed IRA account and meeting your annual contribution limits to a tee, you still cannot pre-maturely withdraw your IRA funds at a whim. There are IRA withdrawal rules that you need to be completely aware of to avoid penalties which will affect your account in the future.
- Below 59 ½ years old– this is where a pre-mature withdrawal of funds may occur, since the age requirement was not met. For Traditional Individual Retirement Account holders, distribution of IRA funds below the age of 59 1/2 will be subjected to a penalty fee that amounts to 10% of the total funds. State and federal income taxes will also be applied.
- Ages between 59 ½ and 70 ½ years old – this is considered to be the best age bracket to start withdrawing and distributing your IRA funds without thinking about penalties. You have to be aware, though, that federal and even state taxes will apply as well. This is also the time when you can start thinking about how you would like to make use of your funds in order to reach its maximum income potential.
- Over 70 ½ years – reaching this age will mean that you are required to really withdraw from your IRA account. Failure to do so will result to serious implications. Meeting the required minimum distribution or RMD is really important if you do not want your Traditional IRA funds to diminish due to fees or fines that you have to pay for.
Planning for Your Retirement Years Count
There are so many things that you can do in order to plan for your future,. One of which is to open self-directed IRA. And should you decide to do so, make sure that you consult the right people to help you find out the different IRA withdrawal rules, contribution limits and how to properly set up your account.
- Checkbook control
- Checkbook IRA investment
- Personal IRA
- Custodian for self directed ira
- ROTH IRA