I want to use distributions from my Individual Retirement Account (IRA) to pay student loans. I am not yet age 59 Â½. Will I owe a tax penalty for taking an early withdrawal from my IRA even if Iâ€™m using the distribution to pay student loans?
Yes, an early-distribution penalty will apply when using an IRA to pay student loans . You must pay the 10% additional tax on the portion of your IRAs you withdrew to pay student loans. An exception to the penalty applies to IRA distributions used to pay for current educational expenses.
Learn more about form CP2566, why you received it, and how to address past-due tax returns with help from the tax experts at H&R Block.
The IRS can only take your paycheck if you have an overdue tax balance and the IRS has sent you a series of notices asking you to pay. Learn more from the tax experts at H&R Block.
Find the filing deadline for an amended tax return with help from with tax experts at H&R Block.
Read the IRS definition of a payroll tax penalty and get more insight from the tax experts at H&R Block.