This may sound a fanciful scenario, yet recent events across Europe â including the looming independence referendum in Scotland â tell a very different story. Six days ago, the people of Spainâs most prosperous region, Catalonia, voted overwhelmingly for parties favouring the breaking away from Spanish rule.
1 If you are 55 or older and retired, you can withdraw from your TSP without being charged the 10% tax penalty (which is normally tacked onto early withdrawals) in addition to regular income taxes.
The question is: How can I take money out of my Thrift Savings Plan (TSP), 401k, IRA or other retirement plan without paying the Internal Revenue Service (IRS) an extra 10% early withdrawal penalty because I am NOT age 59-Â½ yet? There is a little known IRS rule called a 72(t). It allows you to take equally substantial distributions, to ELIMINATE the 10% early withdrawal penalty normally due for withdrawals prior to age 59-Â½. So let's review how it works. You stop working due to loss of job, or health, layoff, RIF, or an early out offer. You can roll your TSP into an IRA. After the rollover is completed you apply for a 72(t) equally substantial distribution. The IRS allows you to base your payment on the following factors: 1  Your age. 2  The age of your beneficiary. 3  The amount of money you have.