Individuals who are not disabled and who make lump-sum withdrawals from an Individual Retirement Account (IRA) prior to age 5972 years must pay a 10 percent penalty tax.

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This statement is true. Individuals who withdraw money from an IRA before the age of 59 ½ and are not disabled must pay a 10 percent penalty tax in addition to normal income taxes. There are some exceptions to this penalty, such as for certain medical expenses or first-time home purchases, but in general, the penalty applies.

Individuals Who Are Not Disabled and Who Make Lump-Sum Withdrawals