IRA Withdrawal Rules

Withdrawing Funds from Your Equity Trust Account

To receive funds from your Equity Trust IRA without penalty, you must reach the age of 59 ½ (the Roth IRA also requires that the account has been open for at least five years). When you're ready to access funds, you must complete and submit an Equity Trust Distribution Form. Equity Trust will then distribute funds to you.

Required Minimum Distributions

Traditional IRA, SEP, SIMPLE and Solo 401(k) account holders must begin taking required minimum distributions (RMD) from their accounts beginning April 1st of the year following reaching the age 70 ½.

RMD is calculated by special formula relating to life expectancy, please consult with IRS Publication 590 and/or a tax consultant. RMDs are calculated for each account, which means if you have multiple accounts you are required to take distributions from each account.

Special Note on Premature Distributions

You can generally withdraw funds from a Traditional or Roth IRA without penalty at any time after you have attained the age of 59 ½ . If you decided to withdraw money from your Traditional or Roth IRA account prior to the attainment of age 59 ½ you will be subject to the imposition of a 10% early distribution penalty tax.

Are there exceptions to the 10% early distribution penalty tax?

Yes, there are several exceptions to the 10% early distribution penalty tax. Among the exceptions recognized under the Internal Revenue Code are the distributions due to the following events:

• Death
• Disability
• Qualified higher education expenses;
• The distributions are part of a series of substantially equal payments;
• Unreimbursed medical expenses that exceed 7.5% of your adjusted gross income;
• Medical insurance premiums
• Expenses associated with buying or building a first home;
• Payment of any IRS levy; and
• Qualified reservist distribution

For additional information regarding the exceptions to the early distribution rules, please see IRS Publication 590 or contact your first class service team.