Can I take out my Ira savings under 5,000?

Question

Due to the Pandemic  ,Can  I take out my last  amount of under $5,000 from my Fidelity IRA that says after 71 years of age you must take it  in a check they send you monthly or yearly  so you don't get  a high penalty for withdrawing the full amount ?

Amy · Answer

No, that was allowed in 2020 but no such rule has been passed for 2021.

If you're under 59.5 and it's a Roth account you can take out as much as you contributed, but not the investment earnings.
If you're over 59.5 and the account has been open at least 5 years, you can withdraw all of it.
If you're over 71 you MUST start withdrawing.

A Hunch · Answer

Your question doesn't make a lot of sense.

In 2020, there was no early withdrawals penalty due to the CARES Act. 
Anyone over age 59.5, can withdraw without a penalty at any time.

When you are 72, you are required to take minimum required distributions (RMD).  For a IRA valued at $5000, this would be about $300 you are required to take out.

Any distributions increase your taxable income.  $250 is not going to have much baring on your taxes.

Amy's answer is related to ROTH IRAs, not traditional IRAs.

Eva · Answer

There is no penalty for withdrawals after age 59 1/2.  You will have to pay income tax on it.

Can I take out my Ira savings under 5,000?

3 Answers