Lets say Im investing my money in a Roth IRA and I don't plan to take it out until its time to retire, do I have the option to getting my money in one lump some or can I have it sent to me in bi-weekly or monthly installmets?
2006-08-17 19:50:49 · 6 answers · asked by TNA Ambassador 6 in Business & Finance ➔ Investing
It appears to me that Andy (the level 4 guy) is the one who didn't read the question. Andy gave you a very good explanation to a completely unrelated question.
When you reach retirement and begin to withdraw money from your account you will have to consult the company that your IRA is with to find out what options are available to you for withdrawl. There is nothing in the tax laws that preclude you from taking it out in a lump sum or installment payments but some individual companies have restrictions on the manner in which you can withdraw funds. The reason that some have these restrictions is because everytime that you withdraw money from any kind of IRA it is a reportable event which results in additional work and expense on the part of the brokerage company. I once worked for a company that only gave you the option of taking one withdrawl per quarter or a single lump sum distribution.
You can check with the company you have your IRA with now to see what their options are for withdrawing funds. Obviously that policy could change over time. I hope that this was helpful. Good luck.
2006-08-17 21:13:33 · answer #1 · answered by Gator714 3 · 0⤊ 1⤋
Once you retire, you can take the money out of your Roth IRA however you wish.
The funds must sit in the account for at least 5 years before you withdrawl them. So, if you plan to make a lump sum payment then stop contributing 5 years prior.
2006-08-18 02:54:57 · answer #2 · answered by Plasmapuppy 7 · 0⤊ 0⤋
Here's a fairly straightforward explanation:
"Any qualified distribution from a Roth IRA is NOT included in gross income for individual tax purposes. Simple as that. In effect, a qualified distribution from a Roth IRA is tax-free... no taxes due on the principal... no taxes due on the earnings... no taxes due, period.
To be qualified, the distribution MUST be:
1. Made on or after the date you become age 59 1/2; OR
2. Made to your beneficiary, or to your estate, after you die; OR
3. Made to you after you become disabled within the definition of the IRS code; OR
4. Used to pay for qualified first-time homebuyer expenses.
But -- and this is a very big but -- even if one of the qualifications above is met, the distribution is STILL not qualified if it is made within a five-tax-year period."
(With all due respect to the Leven 6 Answerer above, he seems not to have read the question. Or if he did, didn't know the difference between a Roth IRA and a regular one. And hey, I'm in Switzerland, not the USA which is why, although I was reasonably sure I knew the answer, I quoted an authority.)
2006-08-18 02:55:47 · answer #3 · answered by Anonymous · 0⤊ 1⤋
just a follow up to another answer... i think that a Roth IRA is tax free after five years. and yes you can get the money any way you want.
2006-08-18 02:57:21 · answer #4 · answered by up all night 4 · 0⤊ 0⤋
it is your money, it is your choice. It is tax-free, you could do whatever with that amount
2006-08-18 22:17:29 · answer #5 · answered by Hoa N 6 · 0⤊ 0⤋
sorry but who and what is IRA?
2006-08-18 03:00:13 · answer #6 · answered by Anonymous · 0⤊ 1⤋