Can I take my Roth contributions out at any time without taxes and penalty?

Question

It is after tax money, so what does the IRS care? Doesn't the 5 year rule apply to earnings only?

Roth, not Trad IRA.

Answer 1

You can ALWAYS take your own contributions out of a Roth IRA, as you say, they are after tax earnings and the IRS doesn't care.

They do care about the earnings however. If you take the earnings out under age 59 1/2, regardless if you meet the 5 year rule or not, you pay taxes and a 10% IRS penalty (unless you meet an exception). The only exceptions to this rule are if you meet the 5 year rule & are disabled, dead, qualify for a first time home purchase, are taking 72(t) distributions, have qualifying medical expenses, using the money for college, you're paying medical insurance after losing your job or if the IRS is penalizing your IRA.

check out page 60 of IRS Publication 590 (see the link) for all the information you could ever want to know about Individual Retirement Arrangements! Have Fun!!!

Answer 2

Yes. But you cannot withdraw the interest, capital gains, or dividends without a big penalty. Only the contributions. Remember.

Answer 3

No. You can take out IRA contributions for certain events such as buying a house for the first time, paying for your college education expenses or non-reimbursed medical expenses. Here's a link below for further information. Good luck...

Answer 4

Distributions that are a return of your regular contributions are tax–free.