I was told by my financial planner that as long as you are 59 before January 1st that I could withdraw funds any time in the year. I turn 59 and a 1/2 May 7. However, my CPA said I would be penalized if I withdraw before May 7. Who is correct?

Your CPA is correct. Everything I have read says you must either be 59-1./2 years of age when you make the withdrawal, or you must have separated from service from the company where the 401(k) plan is located in the year in whihc you turned 55, or later. So - what age were you when you left your company?