Early 401k / IRA Withdrawal Penalty
401k & IRA Early Withdrawal Penalty Calculator
What this calculator does
Taking money from a traditional 401k or IRA before age 59.5 usually triggers a 10% penalty plus income tax. A Roth IRA plays by different rules: contributions come back tax- and penalty-free at any age, and only the earnings above them are exposed. Pick your account type and this calculator shows the actual cash you receive. It models IRS retirement-account rules only: a bank CD's early-withdrawal fee is forfeited interest set by the bank, and a defaulted 401k loan becomes a deemed distribution of the outstanding balance — related, but different math.
The math, with a worked example
Traditional 401k / IRA: penalty = withdrawal × 0.10, income tax = withdrawal × tax bracket, cash received = withdrawal − penalty − tax. Roth IRA: contributions come out first, tax- and penalty-free; only earnings above your contribution basis take the 10% penalty and income tax. A $10,000 early withdrawal at a 22% tax bracket leaves only $6,800 after $1,000 penalty and $2,200 tax.
Why this matters
An early withdrawal from a traditional 401k or IRA is taxed twice: the 10% penalty plus income tax at your bracket. At the 22% bracket, a $10,000 withdrawal hands you $6,800, and the true cost is bigger because every dollar pulled out forfeits its future compounding. Run the numbers before you sign the distribution form.
Methodology and transparency
The 10% additional tax is set by IRC §72(t), and the Roth ordering rule (contributions out first, then earnings) comes from IRS Publication 590-B. The assumption most likely to be wrong for you: the tool applies one flat marginal rate to the whole withdrawal. It does not model bracket-crossing, and a large withdrawal is itself income that can push you into a higher bracket, so the real tax bill can be worse than the flat estimate. Everything runs in your browser; no data is sent or stored.
Last reviewed: 2026-08-08
Common questions
Are there exceptions?
Yes. IRC §72(t) waives the 10% penalty for death, total and permanent disability, unreimbursed medical expenses above 7.5% of AGI, substantially equal periodic payments, and, for IRAs, up to $10,000 toward a first home and qualified higher-education costs. Leaving your job at 55 or later also exempts that employer's 401k (the rule of 55). Income tax is still due on traditional-account withdrawals — see IRS Publication 590-B.
Should I withdraw early?
Usually no. Between the 10% penalty, income tax, and the compounding those dollars stop earning, an early withdrawal is one of the most expensive ways to access cash — a 401k loan or Roth contribution withdrawal usually costs less.