IRA--Deceased Spouse

If one member of a married couple dies and leaves an IRA to the other, there is a potential pitfall to avoid if the surviving spouse is under 59 1/2 years old. If the surviving spouse takes distributions from the IRA, there are no penalties for early distribution, because death is an exception. However, if the surviving spouse rolls it over into his or her own IRA or into a new IRA, then the death exception no longer applies, and penalties will be assessed on distributions. The only thing the surviving spouse can do in that situation to avoid penalties is to wait until he or she becomes 59 1/2, or until a situation arises in which some other exception applies.

Some of the other exceptions are:
Disability
Medical (subject to severe limits)
Distributions to unemployed individuals for health insurance premiums
Higher education expenses
First home buyer (up to $10,000)
Distributions to reservists while on active duty for at least 180 days.