The rules for Roth IRA withdrawals split cleanly along one line: your own contributions can come out at any age, for any reason, with no tax and no penalty, while earnings and converted funds carry conditions. To pull earnings out entirely tax-free, the account has to be at least five years old and you generally have to be 59½ or older. Converted amounts run on their own five-year clock. Miss those marks and you may owe income tax on the earnings portion plus a 10% early-withdrawal penalty, unless an exception applies.
How the Order of Withdrawals Protects You
The IRS doesn’t let you choose which dollars leave the account, and the fixed order works in your favor. Regular contributions come out first. Because you funded them with money you already paid tax on, they’re never taxed or penalized regardless of your age or how long the account has been open. Conversion and rollover amounts come out next, oldest first. Earnings come out last.1Internal Revenue Service. Publication 590-B (2025), Distributions from Individual Retirement Arrangements (IRAs)
That ordering is the reason most modest withdrawals never trigger any tax at all. If you’ve put in $40,000 over the years and the balance has grown to $55,000, you can take out up to $40,000 with zero tax consequences. Only when you exceed your total contributions do you start touching the taxable layer.
When a Withdrawal Is Completely Tax-Free
A qualified distribution is the ideal outcome: the entire withdrawal, earnings included, is tax-free and penalty-free. Two conditions have to be met at the same time.2Office of the Law Revision Counsel. 26 USC 408A – Roth IRAs
The first is the five-year rule. Your Roth IRA has to have been open for at least five tax years. The clock starts on January 1 of the year you made your first contribution to any Roth IRA, not the day the contribution posted. A first contribution made March 15, 2024 that counted for tax year 2023 starts the clock on January 1, 2023, and the five-year period ends December 31, 2027.3eCFR. 26 CFR 1.408A-6 – Distributions There’s only one clock across all your Roth IRAs. Opening a second account later doesn’t reset it, and it doesn’t give you a fresh one.
The second condition is a qualifying event. Reaching age 59½ is the common one. A distribution also qualifies if you become permanently disabled, if the funds pass to a beneficiary after your death, or if up to $10,000 goes toward a first-time home purchase.2Office of the Law Revision Counsel. 26 USC 408A – Roth IRAs Clear the five-year rule and one qualifying event, and the withdrawal is free of federal income tax.
Conversions Have Their Own Five-Year Clock
This is where people get tripped up. If you converted money from a traditional IRA or 401(k), each conversion runs its own separate five-year holding period, independent of the account-level rule. Your Roth could have been open for 15 years, and a conversion you did last year still has a fresh five-year countdown.1Internal Revenue Service. Publication 590-B (2025), Distributions from Individual Retirement Arrangements (IRAs)
Pull converted dollars out inside that window while you’re under 59½ and you owe a 10% penalty on the portion of the conversion that was taxable when you converted. The clock starts January 1 of the year the conversion took place. This is what makes the Roth conversion ladder work only for the patient: each year’s conversion has to age five full years before you can touch it penalty-free.
Exceptions to the 10% Early-Withdrawal Penalty
Even when a withdrawal isn’t a qualified distribution, several exceptions can knock out the 10% penalty on the earnings portion. Income tax may still apply to any earnings you take, but the extra penalty disappears.4Office of the Law Revision Counsel. 26 USC 72 – Annuities; Certain Proceeds of Endowment and Life Insurance Contracts
- Total and permanent disability.
- Unreimbursed medical expenses that exceed 7.5% of your adjusted gross income.
- Up to $10,000 lifetime toward buying, building, or rebuilding a first home.
- Qualified higher education expenses: tuition, fees, books, and room and board at eligible institutions.
- Up to $5,000 per child for expenses tied to a birth or adoption.
- Health insurance premiums while unemployed, if you received unemployment compensation for at least 12 consecutive weeks.
- A series of substantially equal periodic payments spread over your life expectancy, which you have to keep taking for at least five years or until you turn 59½, whichever is longer.
- An IRS levy against the account to collect a tax debt.
These exceptions only matter once a withdrawal reaches the earnings layer. Because contributions come out first and are always penalty-free, many early withdrawals never get that far.5Internal Revenue Service. Retirement Topics – Exceptions to Tax on Early Distributions
You’re Never Forced to Withdraw
Unlike a traditional IRA, a Roth IRA has no required minimum distributions while you’re the original owner. There’s no age 73 trigger, no annual withdrawal you have to take.6Internal Revenue Service. Retirement Plan and IRA Required Minimum Distributions FAQs The balance can keep growing tax-free indefinitely if you don’t need the money, and heirs generally inherit the funds tax-free when the five-year rule was satisfied before your death.
Withdrawal Rules for Inherited Roth IRAs
The rules split based on who inherits.
Surviving Spouse
A surviving spouse can treat the inherited Roth as their own. Once you do, it follows the standard rules: no lifetime RMDs, and the usual five-year and age 59½ tests for tax-free earnings. If you don’t need the money right away, this preserves tax-free growth for the rest of your life.1Internal Revenue Service. Publication 590-B (2025), Distributions from Individual Retirement Arrangements (IRAs)
Non-Spouse Beneficiary
Non-spouse beneficiaries generally have to empty the inherited Roth within 10 years of the original owner’s death. Distributions are typically tax-free if the original owner had already satisfied the five-year rule before dying. You have flexibility in how you time withdrawals across the 10-year window, but the whole balance has to be out by December 31 of the year containing the 10th anniversary of the death. Fall short and the IRS imposes a 25% excise tax on the amount you should have taken.1Internal Revenue Service. Publication 590-B (2025), Distributions from Individual Retirement Arrangements (IRAs)
Reversing a Withdrawal Within 60 Days
If you take money out and change your mind, you have 60 days to put it back into a Roth IRA and have the IRS treat it as a rollover rather than a permanent withdrawal. No tax, no penalty. That’s a useful safety valve when an emergency resolves itself quickly.7Internal Revenue Service. Rollovers of Retirement Plan and IRA Distributions
Two limits matter. You can only do one IRA-to-IRA rollover in any 12-month period, and this cap applies across all your traditional and Roth IRAs together. Miss the 60-day deadline and the withdrawal is permanent, meaning the earnings portion can become taxable and penalized. The IRS can waive the deadline in limited circumstances such as serious illness or a natural disaster, but that isn’t something to plan around.
How the Withdrawal Shows Up at Tax Time
Every Roth IRA distribution generates a Form 1099-R from your custodian by the end of January following the year of the withdrawal. Box 7 carries a distribution code that tells you and the IRS what kind of withdrawal it was. Code Q means the custodian has confirmed a qualified distribution and no tax is owed. Code T means you’ve hit an event like age 59½, disability, or death, but the custodian isn’t tracking whether the five-year rule was met, so you may need to sort qualification out yourself. Code J flags an early distribution with no known exception, which is the signal that tax and penalty on any earnings are in play.
You also have to file IRS Form 8606 with your return for any Roth IRA distribution during the year, other than a rollover or a return of excess contributions.8Internal Revenue Service. Instructions for Form 8606 The form tracks your basis, the total contributions you’ve made, and calculates how much (if any) of the withdrawal is taxable. Even a fully tax-free qualified distribution gets reported on it.
One planning note tied to how much room you have to work with: for 2026, the annual contribution limit is $7,500, or $8,600 if you’re 50 or older.9Internal Revenue Service. 401(k) Limit Increases to $24,500 for 2026, IRA Limit Increases to $7,500 Every dollar you contribute stays yours to withdraw at any time. The rules above only start to bite once you go past that contribution base into the conversion and earnings layers underneath.