How can I take funds out of my defined pension plan
L1: How can I take funds out of my defined pension planI am a deputy sheriff in Sonoma County Cal. I have 221,000 in my defined pension plan. Is there a way for me to tap into those funds in order to obtain a down payment for a home.
Gary Delfino2009-03-03 22:55, By: Gary Delfino, IP: [126.96.36.199]
L2: How can I take funds out of my defined pension planLoans from tax-qualified plans may or may not be allowed. Most all defined benefit pension plans would probably not allow any loans.
You need to check with yourPlan Administator.
2009-03-03 23:14, By: Gfw, IP: [188.8.131.52]
L2: How can I take funds out of my defined pension planDon’t think this relates to a 72t plan, but will respond anyway.
I doubt that your DB plan offers partial distributions to active employees, but it may be possible at a certain age. You need to ask the plan administrator. In the unlikely event you are allowed a distribution, the best way to do this is to request a direct rollover to a traditional IRA. From the IRA you can take up to 10,000 lifetime penalty free for a first home purchase. To meet that definition, you cannot have owned a primary home within the prior 24 months. In your area you cannot do much with 10,000 but this would save $1,000 in penalties if you take the distribution from an IRA. It must first go to an IRA.
You might also qualify for the new stimulus home buyer credit up to 8,000. This has separate requirements, but could be combined with the IRA distribution. This is a much better deal because it is direct tax credit rather than a deduction from your pension funds.
2009-03-03 23:19, By: Alan S., IP: [184.108.40.206]