To receive funds from your self-directed IRA without penalty, you must turn 59 and a half years old (the Roth IRA also requires that the account has been open for at least five years). To start withdrawing funds from your self-directed IRA, you must be at least 59 and a half years old. While you're not required to start withdrawing money right now, it's the earliest date you can without any problem. In the case of Roth IRAs, you must have the account open for at least 5 years.
If you make early distributions, each withdrawal will result in a 10% penalty. On top of that, if you have a traditional IRA, you'll also need to pay any income taxes you've deferred. A self-directed IRA allows you to explore unconventional areas of retirement investment while enjoying the tax-deferred growth that makes traditional IRAs so attractive. If you choose the option of a self-directed IRA, be sure to follow the IRS rules or you risk losing your IRA's deferred tax benefits.
The process for an early distribution of self-directed IRA is the same for any distribution with IRA Resources. The rules don't change, so all the rules that apply to any IRA will apply to the self-directed IRA. A self-directed IRA, or SDIRA, is a type of IRA that allows you to invest in assets or funds in a more flexible way than a traditional or Roth IRA. Self-directed IRAs are subject to the same rules as traditional IRAs when it comes to early withdrawals.
While self-directed IRAs have more control than a typical investment in a mutual fund IRA, you'll need to work with what's called a custodian. While a regular IRA has a fairly standard set of investment opportunities, a self-directed IRA also allows you to use alternative investments. A self-directed IRA is a tax-deferred retirement account for those who want more control than a regular IRA offers.