- When can I withdraw funds from an employer-sponsored retirement plan?
- How are retirement plan withdrawals taxed?
- When can I withdraw funds from an IRA?
- How are IRA withdrawals taxed?
- When can I withdraw funds from a Mutual Fund or Brokerage Services account?
- What should I consider when withdrawing funds?
- How much can I withdraw?
- Am I eligible to make a withdrawal over the phone?
When can I withdraw funds from an employer-sponsored retirement plan? The availability of cash withdrawals from an employer-sponsored retirement plan is generally determined by your employer’s plan rules. Your employer’s plan rules dictate when and how you can withdraw funds from your retirement plan. If you own the TIAA Traditional Annuity, there may be some restrictions on the amount that you may be able to withdraw at a given time.*
You can log in to your account to see the amount available for withdrawal. You can also complete your request for withdrawal through your online account.
How are retirement plan withdrawals taxed? Pre-tax contributions withdrawn from a tax deferred retirement plan are taxed as ordinary income. Any after-tax funds in the account are returned to you tax-free; however, the earnings from these after-tax contributions are still taxable.
Some retirement plans allow for Roth contributions. If Roth contributions are made to the retirement plan, the contributions have already been taxed and the earnings are withdrawn tax-free provided the date of the distribution is at least 5 years after January 1 of the year in which the first Roth contribution was made to the plan (or its predecessor in the case of a rollover) and the participant is either age 59½ or older or considered disabled. For certain withdrawals, due to Internal Revenue code, we are required to withhold 20% of the taxable amount withdrawn as a prepayment of the taxes.
Additionally, withdrawals from employer sponsored plans taken before you obtain age 59½ are generally subject to a 10% early withdrawal penalty (unless certain conditions are met).**
When can I withdraw funds from an IRA? You can withdraw funds from a Traditional, Roth or SEP IRA at any time. You can log in to your account to view the amount available and request the withdrawal online.
How are IRA withdrawals taxed? Withdrawals from Traditional and SEP IRAs are generally taxed as ordinary income. However, if you have funded your IRA with non-deductible contributions (and have reported properly with the IRS), this portion of your IRA is not taxable upon withdrawal. Withdrawals before age 59½ are generally subject to a 10% early withdrawal penalty (unless certain conditions are met).**
Withdrawals from Roth IRAs are tax free provided the date of the distribution is at least 5 years after January 1 of the year in which the first Roth contribution was made to the plan (or its predecessor in the case of a rollover) and the participant is either age 59½ or older or considered disabled. Prior to meeting these requirements, any earnings withdrawn are taxable as ordinary income and subject to the early withdrawal penalty before age 59½.
When can I withdraw funds from a Mutual Fund or Brokerage Services account? You can withdraw funds from a regular after-tax Mutual Fund or Brokerage Services account at any time. Please call 800 223-1200 to request a withdrawal from your Mutual Fund account or 800 927-3059 to withdraw funds from your Brokerage Services account.
What should I consider when withdrawing funds? When you need to withdraw funds, consider all the types of investment accounts you have and the associated tax implications involved when withdrawing funds from each. You should consult with your tax advisor to determine the right type of withdrawals to take for your situation.
How much can I withdraw? You can log in to your account to view the amount you can withdraw from your employer-sponsored retirement plans. Your online account shows your balance and the amount available to withdraw.*
Generally, you can withdraw any amount (up to your total balance) from your IRA, mutual fund or brokerage account.
Am I eligible to make a withdrawal over the telephone? Telephone withdrawals are available from TIAA-CREF; however, not all contracts will qualify. Telephone withdrawals may be limited by institutional plan rule restrictions, contract maintenance, or investment restrictions. Please call a licensed TIAA-CREF retirement consultant at 800 842-2252 weekdays from 8 a.m. to 10 p.m. (ET) and on Saturdays from 9 a.m. to 6 p.m. (ET) to see if you qualify for a telephone withdrawal.
*Cash withdrawals from TIAA Traditional must be made in ten annual installments from Retirement Annuities. Group Retirement Annuities may allow a lump-sum withdrawal within 120 days after your leave your employer, but a surrender charge applies. After the 120 period, withdrawals can be made over a five year period. Retirement Choice Annuities allow you to withdraw TIAA Traditional balances over a seven year period. Withdrawals from Supplemental and Retirement Choice Plus plans are generally available once you leave the sponsoring employer, reach age 59½, become disabled or meet the IRS definition of hardship.
** An early withdrawal penalty does not apply if you meet one of the following conditions:
- You begin lifetime income
- You leave the sponsoring employer at age 55 or older
- You have unreimbursed medical expenses that exceed 7.5% of your adjusted gross income
- You are disabled
- The withdrawal is made by your beneficiary after your death
- The withdrawal is made from an account issued through a Qualified Domestic Relations Order
- The withdrawal is made for up to $10,000 to pay for first-time homebuyer expenses (IRA Only)
The tax information contained herein is not intended to be used, and cannot be used by any taxpayer, for the purpose of avoiding tax penalties that may be imposed on the taxpayer. It was written to support the promotion of the products and services addressed herein. Taxpayers should seek advice based on their own particular circumstances from an independent tax advisor.