NYS has given me total disability, however my employer still has me listed as active. Will I need to still pay the 10% penalty for early withdrawl?

If you employer has you listed as a active employee you can not even take a withdrawal, you can not withdraw until you no longer work there ( normally) you can do a loan.

Were you injured on a workers comp accident or do you have disablity coverage though where you work

Yes I was injured on the job and am receiving workers comp also SS Disability. I am 57 and could retire early. I really could use the money but don't want to get hit with the 10% penalty.

Zill: first thing to check is whether your employer would allow you to take a distribution while still an active employee. Talk to your plan administrator about that - some company plans do allow some active employees to take distributions depending on age, others don't. BTW - the IRS does mandate that alll plans allow withdrawals for certain "hardship" purposes - but disability is not one of those reasons. If they do allow you to take a distribution, you will NOT be hit with the 10% penalty IF you are totally and permanently disabled. And if you do retire and then take a distribution, you will not be hit with the 10% penalty because you would have been separated from service at age 55 or later (even if not totally and permanently disabled). Hope this helps.