Don’t roll over a company plan balance to an IRA and tap it before age 59½. The withdrawal can be nailed with a 10% penalty, an Appeals Court decides. A 56-year-old attorney left his law firm to return to school for an economics degree. He took the money that he had in his firm’s plan and rolled it over to a SEP IRA. The next year, he took out $240,000 from the IRA and used $40,000 to pay his tuit…ion. Because he tapped the IRA before he had reached age 59½, he owes the 10% penalty on the $200,000 payout that he didn’t use for education. The exception to the penalty for withdrawals made after leaving your job in the year you are age 55 or older is available only for payouts from company plans, not from IRAs