What are the Withdrawal Rules From My 457 Plan?

457 plans are the only retirement plan that does not require you to wait until a certain age to avoid an IRS penalty on withdrawals.

Unlike 401(k)s and 403(b)s, you are allowed to take money out of a 457 Plan before the age of 59½ without a 10% early withdrawal penalty, but only if you’ve separated from service. Separation from service can mean retiring or just leaving to take a job elsewhere.

Roth IRAs allow you to withdraw your principal amount early without penalty, but you will incur taxes and penalties if the gains are withdrawn. 457 plans do not have such stipulations. All other retirement accounts require certain exception criteria to be met for the IRS not to penalize you for early withdrawals.

Of course, when you withdraw, you’ll still be subject to income taxes on the money if it is not rolled into a qualified account. If your 457 plan was not at a state or local government entity, you do not have the option to roll plan assets into an IRA.