ROTH IRA neg gain closing?

Question

In early 40's with small ROTH IRA with overall net loss. At this point can I close the account without tax/penalties to get what's left back out? Is this considered a nonqualified distribution or something else?

Answer 1

Actually, you can always withdraw contribution dollars from a Roth IRA without penalty. You are required to pay tax and penalties only when you withdraw the earnings before retirement. Though it's unfortunate that your IRA hasn't earned anything, at this point you can withdraw the entire balance without penalty.

You should, however, check your records to carefully to make sure that the present balance is lower than the amount you have contributed. But even if your account has a net profit, you can still withdraw however much you have contributed without tax or penalty.

If you have a Traditional IRA, the rules are different, since you probably got a tax deduction upfront. Early withdrawals from Traditional IRAs are taxed and penalized.

Answer 2

Makes no difference that's in a Roth IRA, commonplace IRA or taxable investment account. Your objective fund is invested in a mix of asset kinds - shares, bonds and money contraptions. The fund's returns are in accordance with capital gains, dividend gains and interest earnings from those investments - all of that are reinvested as further fund shares. In that experience, your investment "compounds." objective date money regulate the asset allocation as time progresses. share value (reported as NAV) will variety up and down, yet over the long term era (that's what mutual money are for), you should work out a great finished return. you will see classes while the fund share value decreases - yet are not getting scared and yank your money out. this is the WORST situation you're able to do.

Answer 3

If it is worth less than what you invested you can closed out the account without taxes or penalties. The trustee will probably hit you with an account closing fee though.