Another Medical Deduction Question

[Brian EA]

Primary taxpayer is 57 years old and spouse is 62. Both are unemployed. Primary taxpayer receives a pension from which medical deductions are taken. She also withdrew from her retirement plan, $40,000 on which she has to pay the 10% penalty for early withdrawal.
My question is; can she reduce some of the penalty by claiming an exception on Form 5329? Her medical deduction from her pension is done as a convenience to avoid sending in the funds every month.

Thanks
Brian

[FEDUKE404]

Perhaps

You may wish to review the IRS instructions for the "medical insurance" exception for line 2 of Form 5329. . .

Exception 05

Qualified retirement plan distributions up to the amount you paid for unreimbursed medical expenses during the year minus 10% (or 7.5% if you or your spouse are age 65 or older) of your adjusted gross income for the year.

FE