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Ask Asad Rahman Your Own Question
Asad Rahman
Asad Rahman, Lawyer
Category: Employment Law
Satisfied Customers: 1729
Experience:  Practicing Attorney with 10 years experience
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I worked at Caloric plant 5 years. They took out pension

Customer Question

I worked at Caloric plant for over 5 years. They took out pension they closed the Florence plant about 10 years ago but I was laid off in 1995. Why can't I draw my pension at 62years old instead of 66 years.
Submitted: 11 months ago.
Category: Employment Law
Expert:  Asad Rahman replied 11 months ago.

You must consider your options carefully when withdrawing money early from your pension. You may get hit with a 10-percent tax penalty from any early withdrawal before the age of 59 1/2. The only exceptions to this penalty are if you have been laid off or you leave your job at the age of 55. Another factor is based on the type of pension plan. Cash or deferred arrangement plans, such as a 401(k) or a profit-sharing pension, allow for early withdrawal. Defined benefit plans that give you a specified monthly benefit at retirement do not allow withdrawals under any circumstances. Always contact your employer or plan administrator about your options.

Expert:  Asad Rahman replied 11 months ago.

If you are over age 67 when you begin making withdrawals from your pension plan, you'll avoid the early withdrawal penalty. This penalty applies only if you withdraw money from your pension before you reach age 59 1/2. If you trigger the early withdrawal penalty, you will owe a penalty tax equal to 10 percent of the amount of your withdrawal. This tax applies in addition to any income tax you may owe on the payments you receive.

Expert:  Asad Rahman replied 11 months ago.

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