Withdraw of ROTH Earnings
I am 56 1/2 years old and am considering making a contribution to a ROTH IRA in 2020. I know that I can withdrawal my contribution amount at anytime tax and penalty free but my question is relative to the 10% penalty of the withdraw of earnings. I’m not sure if it is relative but for the record I established my first ROTH IRA in 2010. Do I have to wait 5 years for a withdraw of earnings from the date of my 2020 contribution in order to avoid the 10% penalty OR will the waiting period end in 3 years when I am 59 1/2? Thanks in advance for your clarification
Permalink Submitted by Alan - IRA critic on Mon, 2020-09-21 18:44
It will end at 59.5. Your Roth will be fully qualified at that date and the entire balance including earnings can be withdrawn tax and penalty free. Of course, it would be preferable if you could avoid those distributions.