3969 / What is an early distribution from a qualified plan, and what penalties relate to it?

Except as noted below, amounts distributed from qualified retirement plans before the participant reaches age 59½ are early or premature distributions subject to an additional tax equal to 10 percent of the amount of the distribution includable in gross income.¹

To the extent that they are attributable to rollovers from a qualified retirement plan or a Section 403(b) plan, amounts distributed from Section 457 plans ( Q 3584) generally will be treated as distributed from a qualified plan, for purposes of the early distribution penalty.²

The 10 percent penalty tax does not apply to distributions:

(1)  made to a beneficiary, or the employee’s estate, on or after the death of the employee;