A qualified reservist is a member of the military reserve who is not active, but when called to duty, is eligible to make an early withdrawal from a retirement account without incurring the usual early distribution penalty.

Under most circumstances, the IRS imposes a penalty of 10% on the taxable amount withdrawn from a retirement account by a taxpayer younger than 59½ years old. Qualified reservists are rare exceptions to this rule. Still, their withdrawals are subject to federal and state taxes.