Dear Dr. Don,
I was just thinking about IRA withdrawal exemptions. If I were to withdraw $5,000 to pay for schooling costs, would I still be allowed to withdraw $10,000 as a first-time homebuyer? From my understanding, I could because the first $5,000 is for school, while the second $10,000 is for the house. But I just want to verify it before taking these distributions.
— Mark Maneuvers

Dear Mark,
You’ve named two of the 11 exceptions to the 10 percent penalty tax on early distributions from a traditional IRA account. Keep in mind that you still owe income taxes on the distributions and big distributions can change your marginal federal income tax rate for the tax year in question.

The Bankrate feature “IRS rules for early IRA withdrawals” discusses your exceptions, as does IRS Publication 590, “Individual Retirement Arrangements.” A basic requirement for avoiding the penalty in all of these cases is that the qualified expense exceeds the IRA distribution.

While I am not a tax professional, the document “Instructions for Form 5329 Additional Taxes on Qualified Plans (Including IRAs) and Other Tax-Favored Accounts” makes it clear that multiple exceptions are allowed by giving the taxpayer direction to pick exception No. 12 — “other” — if more than one exception applies.

Raiding the IRA for education costs and housing costs can make perfect financial sense, but you should always weigh these goals against your retirement goals. I’ve argued in past columns that people early on in their career should go ahead and fund the retirement accounts precisely because they can raid them for other, closer, financial goals.

But don’t lose sight of the distant goal when making that decision and accept the trade-off that you’re making.

Read more Dr. Don columns for additional personal finance advice.