I am 59-1/2, If I withdraw some of my retirement money what penalties and taxes will I have to pay?

At 59 1/2, there is no 10% penalty tax to pay on the federal return (that line shows up on the second page of your 1040). You will receive a form 1099-R from the company that issued you the retirement payment. On that 1099-R, a code will be entered on the form that should indicate that no penalty tax is applicable to the money you received. Thats not to say you are not to pay INCOME taxes on that money.

The amt of federal income taxes you would have to pay are determined by whatever tax rate you pay when you add all your household income together, after subtracting your standard or itemized deductions and your personal exemptions. These deductions and exemptions COULD reduce your income to a point that you are not actually paying ANY federal income taxes at all. If you do have income that can be taxed (after the deductions) then you may be paying taxes of 10 to 33 percent. (If I remember correctly, 33% is the top tax rate)

Now this is only talking about your federal taxes. Depending on what state you live in will determine the amt of state taxes you would have to pay.

Theresa51's post is very accurate, though the top tax rate is 35%.

AtlantaTaxExpert, thanks for the confirmation! And the correction of the 35%!