retirement

How to crack open your IRA without triggering a tax penalty

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OK for school
OK for school | Boston Globe/Getty Images

OK for school

The IRS says no penalty will be assessed as long as you're taking out IRA money for qualified education costs for yourself, your spouse or your children or grandkids.

You must make sure the eligible student attends an IRS-approved institution. This is any college, university, vocational school or other postsecondary facility that meets federal student aid program requirements. The school can be public, private or nonprofit as long as it is accredited.

The retirement funds can be used to pay tuition and fees and buy books, supplies and other required equipment.

Expenses for special-needs students also count. And if the student is enrolled at least half time, room and board also meet IRS expense muster.

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