How to Access Retirement Funds in a Disaster
As appears in IRS Tax Tip 2025-04
The SECURE 2.0 Act makes it easier for qualified individuals impacted by a federally declared major disaster to access their retirement savings.
Eligibility
A taxpayer may be eligible for relief that provides for expanded access to their retirement funds if their principal residence was in a major disaster area and they sustained an economic loss due to that disaster. An economic loss includes, but is not limited to:
- Being displaced from the taxpayer’s principal residence.
- Loss or damage to or destruction of real or personal property from fire, flooding, looting, vandalism, theft, wind, or other cause.
- Lost income due to temporary or permanent layoff.
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Use the tool on FEMA.gov/disaster to find a current list of major disaster declarations.
Types of relief
These types of disaster relief are available to people who qualify:
- May withdraw up to $22,000 from an IRA or other eligible retirement plan.
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- Amount exempt from the 10% early distribution tax.
- May repay to a retirement plan or IRA within three years of the distribution.
- Distribution may be included equally in income over three years.
- A retirement plan may offer increased loan limits and delay repayments.
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(This is Blog Post #1804)
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About the Author: Roger Rossmeisl, CPA
Roger Rossmeisl, CPA, brings over 40 years of experience helping small business owners who have outgrown their current CPA firm and larger companies seeking responsive, cost-effective solutions they’re not receiving from their current CPA Firm. He goes beyond tax compliance, explaining the “why” behind the numbers and their impact on cash flow and other decision making.
An avid follower of federal monetary policy, Roger adds insight into how government actions affect business and wealth. With a niche in franchised new vehicle dealerships, he has served over 100 franchise stores and groups through decades of evolving IRS rules and legislation.
