I'm 60 and I would like to take money from my 457(b) program. Do I have to take a required minimum distribution at 60? Or can I tell them I'd like to take less?

You don't have to start taking RMDs until you're 72. Can you take withdrawals at 60? That depends on whether you've left the job that provides the 457(b) plan. If you no longer work there, you can withdraw as much or as little from your account as you want.

For readers who don't know, a 457(b) is a tax-deferred retirement plan similar to a 401(k) plan. It's a plan offered to state and local government employees, including police officers, firefighters, sanitation workers and public school teachers.

Just like 401(k) withdrawals, withdrawals from 457(b) plans are taxed as ordinary income.

With a 401(k) plan, you're also subject to a 10% early-withdrawal penalty on money taken from your account before you're 59 1/2. (That penalty is waived if you're 55 or older and have left the job.) But there's no penalty on 457(b) withdrawals taken after you leave the job, regardless of your age.

It's a different story if you're still on the job, however.

In that case, you’re only allowed to withdraw money from your 457(b) account if your plan allows hardship withdrawals and you're in such dire straits that you qualify for one. To do that, you must show that a) you've exhausted all other financial options and b) you're facing a financial catastrophe like imminent foreclosure and eviction from your home, enormous unreimbursed medical expenses or college tuition bills. And hardship withdrawals are taxable.

The bottom line

After leaving your job, you can tap your 457(b) plan without incurring an early-withdrawal penalty regardless of your age.

More information

bit.ly/IRSdeferredcompensationplans

bit.ly/IRShardshipswithdrawalsloans

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