Hi, so sorry to have to be the messenger here, but if you're healthy (can't use the disability waiver), aren't using it for first time home buyer purposes, aren't going to roll over into another qualified retirement plan within 60 days of the distribution, distributing for qualified higher education expenses, or have medical expenses that aren't deductible because of the 7.5% agi floor ... then there will only be one thing that would waive the age 59 and 1/2 pre-retirement penalty ....
That's where you take the money out under a series of substantially Equal and Periodic payments ... essentilly over your life expectanct ... and that would be such a small amount each year, that it may not be worth it to you
Here's an excellent article from the Journal of Accountancy, regarding the 16 things that can waive the 10% penalty: http://www.journalofaccountancy.com/Issues/2005/Aug/WithdrawWithoutPenalty.htm
Na dyes if you withdraw it in 2013, it will be added to your taxable income for 2013 (one thing that might make sense is taking some this year, and some just after the 1st of the year)
Yes, sorry, you might look at your income for the year (with this new income) and see where you might go into the next higher tax bracket and see how much you could pull this year without going into a higher bracket
Here's a calculator that calculates substantially equal an periodic payments, but again that might not be enough to help ..... Yes, do you file a single or joint?
Hat's the SEPP calculator
[Tax Rate Schedule X, Internal Revenue Code section 1(c)]
[Tax Rate Schedule Y-1, Internal Revenue Code section 1(a)]
And remember that's TAXABLE income, subtract your personal (and any dependendant) exemptions PLUS standard or itemized deduction to get to the number to be applied to the brackets
Also, this is a good place to estimate your tax: (see section two... It will project both Federal AND state): http://www.tax-rates.org/kansas/income-tax
Still with me?
I still don't see you coming into the chat ... I'll move us to the "Q&A" mode now .... Maybe that will help (We can still continue the dialogue there, just not in real-time as we can here) ... Also, it may help you to see everything at once ... DO let me know if you have more questions