Because you make contributions with pretax dollars, federal income taxes are deferred on supplemental plans until you begin taking withdrawals later on.
An IRS 10% tax penalty will generally apply to cash withdrawals made before age 59½, unless you have medical expenses exceeding the tax-deductible limit or you become disabled, die or retire after reaching age 55. No IRS 10% tax penalty is applied to payments made to children or to a divorced spouse in accordance with a qualified domestic-relations order. This information is not intended to be relied upon as tax advice.
You are encouraged to consult a tax advisor.