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Roth IRA withdrawals are more flexible than other retirement accounts, depending on what you're withdrawing:
- Contributions. This is money that you added into the account. Since you already paid taxes on it, you can withdraw this money at any time and for any reason, tax- and penalty-free.
- Earnings. This is money that grows in your account when your contributions are invested. Withdrawals of earnings fall under two categories: qualified and non-qualified distributions.
Qualified vs. Non-qualified distribution
A qualified distribution is a withdrawal of investment earnings without taxes or penalties. To make a qualified distribution from a Roth IRA, the account must be at least five years old and one of the following must apply:
- You are age 59 ½ or older.
- You qualify due to a disability.
- The withdrawal is made by the account beneficiary or estate after your death.
- The withdrawal is for buying, building or rebuilding a first home (up to a $10,000 lifetime limit).
A non-qualified distribution is when withdrawing investment earnings incurs taxes, penalties, or both. The penalty for a non-qualified distribution is 10%. Jump to the full list of non-qualified distributions.
Each type of retirement account comes with specific tax advantages. With a Roth IRA, contributions aren't tax-deductible, but the earnings grow tax-free. In some circumstances, savers can make qualified withdrawals without taxes or penalties.
Whether a withdrawal is considered "qualified" depends on factors such as your age, length of time the account has been open, withdrawal purpose and more.
When can you withdraw from a Roth IRA?
You can withdraw contributions at any time without taxes or penalties. If you want to withdraw earnings without taxes and penalties, two criteria generally need to be met:
- The account needs to have been open for five years.
- The owner has to be age 59 ½ or older.
» Dive deeper: The Roth IRA five-year rule
What is the Roth IRA early withdrawal penalty?
There is a 10% penalty if you withdraw earnings early from your Roth IRA. In addition to the penalty, you may also pay taxes on the withdrawal at your ordinary income tax rate.
There are some exceptions to the 10% penalty. In certain scenarios, individuals can tap into their Roth IRA earnings early without incurring penalties (more on this below).
Roth IRA distribution rules
How qualified Roth IRA distributions work
A qualified Roth IRA distribution is a withdrawal of investment earnings without taxes or penalties. To make a qualified distribution, the Roth IRA must be at least five years old, and one of the following should apply:
- You are age 59 ½ or older.
- The withdrawal is due to a disability.
- The withdrawal is made to a beneficiary or your estate after your death.
- The withdrawal is for buying, building or rebuilding a first home (up to a $10,000 lifetime limit).
» See our picks for the best Roth IRA accounts
How non-qualified Roth IRA distributions work
Making a Roth IRA withdrawal outside of the above requirements could result in income taxes and a 10% penalty. However, there are exceptions to the 10% penalty — but not ordinary income taxes — if you meet one of the following:
- You have unreimbursed medical expenses that are more than 7.5% of your adjusted gross income.
- The distribution is for the cost of your medical insurance during unemployment.
- You are receiving distributions in the form of a series of substantially equal periodic payments.
- You are taking the distribution for qualified higher education expenses.
- You are a survivor of domestic abuse.
- The distribution is due to an IRS levy.
- You made the withdrawal when you were a reservist, as defined by the IRS.
- The distribution is for a qualified birth or an adoption of a child.
- The distribution is a qualified disaster distribution or qualified disaster recovery distribution.
- The distribution is a corrective distribution.
How to plan a Roth IRA withdrawal
If you are thinking about a Roth IRA withdrawal, first consider how much you need. Then check if your withdrawal is qualified or non-qualified. If it’s the latter, and you are taking out earnings, estimate any taxes or penalties that might apply.
Something to keep in mind: one benefit of Roth IRAs is flexibility. This doesn’t just apply to contributions, but to withdrawals too. Unlike traditional IRAs and some 401(k)s, Roth IRAs don’t have required minimum distributions. That means you don’t have to take out money during your lifetime. Account owners can leave the money in the account to stay invested and passed on to beneficiaries after their death.
Taking money out of a Roth IRA early means potentially losing out on long-term growth. Still, if you're in a tight spot financially, it can be one option.
Frequently asked questions
What is the Roth IRA withdrawal age?
You must be 59 ½ and have held your Roth IRA for at least five years before you withdraw investment earnings tax-free and penalty-free. Roth IRA contributions can be withdrawn at any age because the funds have already been taxed.
How do conversions work in a Roth IRA?
For Roth IRA withdrawals, contributions come out first. Amounts transferred through a Roth IRA conversion come out next on a first-in-first-out basis. Earnings come out last.
» Learn more about Roth IRA conversions
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- 1. Internal Revenue Service. Publication 590-B (2023), Distributions from Individual Retirement Arrangements (IRAs).
