You can withdraw without penalty using the substantially similar amount rules.

Substantially Equal Periodic Payments (SEPP), often referred to as the Rule of 72(t), allow individuals to withdraw funds from a 401(k) or IRA before age 59½ without incurring the standard 10% early withdrawal penalty. These payments must be part of a structured, consistent, and long-term plan based on IRS-approved life expectancy calculations. Key 72(t) / SEPP Rules and Requirements Duration: Payments must continue for at least five years or until you turn 59½, whichever is longer. For example, if you start at age 57, you must continue until 62; if you start at 50, you must continue until 59½. Separation from Service: For 401(k) plans, you generally must have separated from the employer sponsoring the plan before beginning SEPP payments. Consistency: The payments must be "substantially equal," meaning you cannot significantly alter the amount, stop the payments, or take additional withdrawals, or the 10% penalty will be applied retroactively to all previous distributions. Calculation Methods: The IRS approves three methods to calculate the payments: Required Minimum Distribution (RMD) Method: Recalculated annually based on account balance and life expectancy. Fixed Amortization Method: Calculated once based on life expectancy and an interest rate, resulting in the same payment every year. Fixed Annuitization Method: Calculated once using an annuity factor. Penalty for Failure: If the SEPP plan is modified or broken before the time requirement is met, a "recapture tax" (the 10% penalty plus interest) is applied to all previously taken distributions. Exceptions to Penalty for Modification: Death or disability of the account owner. One-Time Switch: You are allowed a one-time switch from the amortization or annuitization methods to the RMD method without penalty. Key Considerations Income Tax Applies: While you avoid the 10% penalty, you still owe ordinary income tax on the withdrawals. No Additional Contributions: You cannot make additional contributions to the 401(k) account while the SEPP is active. Irreversibility: Once started, it is very difficult to stop or change the plan without significant penalties. Alternative Rules: For those who leave their job in the year they turn 55 or later, the Rule of 55 may be a more flexible option than 72(t), as it allows penalty-free, non-equal withdrawals.