Early withdrawal penalty


Q. I will be retiring at age 52 with 27 years as a law enforcement officer. If I do a partial withdrawal of the Thrift Savings Plan for down payment on a house, I know I pay taxes.  I also would pay a penalty as I would be taking the partial withdrawal before age 55. Is the penalty 10 percent or 20 percent? Is the penalty directed at the entire amount withdrawn or toward the amount after taxes?

A. The penalty is 10% of the gross amount.


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Mike Miles is a Certified Financial Planner licensee and principal adviser for Variplan LLC, an independent fiduciary in Vienna, Virginia. Email your financial questions to fedexperts@federaltimes.com and view his blog at money.federaltimes.com.

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