When You Can Actually Withdraw Money From Your Roth IRA

You can withdraw contributions at any age without penalty, but earnings have strict rules

A Roth IRA has two separate withdrawal rules depending on what money you are taking out. You can pull out the dollars you personally contributed whenever you want, at any age, with no tax or penalty. The earnings those contributions generated—the investment gains—are locked until you turn 59½, with narrow exceptions. This split is the core of Roth withdrawal strategy and the reason many people fund a Roth even when they do not plan to retire soon.

The IRS tracks contributions and earnings separately on your account. When you withdraw, contributions come out first. Once contributions are exhausted, any further withdrawal is treated as earnings and subject to the age and holding-period rules. Understanding this order matters because it determines whether you owe taxes and a 10 percent penalty.

Key Takeaways

• You can withdraw your own contributions to a Roth IRA at any age without taxes or penalties, because you already paid income tax on that money.
• Earnings in a Roth IRA cannot be withdrawn penalty-free until you are 59½ and have held the account for at least five tax years, with limited exceptions.
• The five-year holding period is measured from January 1 of the year you first contributed to any Roth IRA, not from the date of each individual contribution.
• Withdrawals for a first home purchase, disability, medical expenses, or education can access earnings before 59½ without the 10 percent penalty, though income tax still applies to earnings.
• If you inherit a Roth IRA, different rules apply to you as a non-spouse beneficiary, and you must begin withdrawals within a set timeframe.

Contributions versus earnings: what the IRS lets you take out

The IRS distinguishes between money you put in and money your investments earned. When you contribute $7,000 to a Roth IRA in a given year, that $7,000 is your contribution basis. If that money grows to $8,500, the $1,500 gain is earnings. You own both, but the tax rules treat them differently.

Contributions are always yours to withdraw. You paid income tax on the money before it went into the Roth, so the IRS does not tax it again when you take it out. No age limit, no holding period, no penalty. This is true whether you withdraw at 25 or 75. The only limit is that you cannot withdraw more than you have actually contributed in total across all your Roth IRAs combined.

Earnings, by contrast, are subject to both an age rule and a holding-period rule. You must be 59½ and the account must have been open for at least five tax years. If either condition is not met, you owe income tax on the earnings plus a 10 percent early withdrawal penalty—unless a specific exception applies.

The five-year holding period and how it is measured

The five-year clock starts on January 1 of the tax year in which you first contributed to any Roth IRA, not when you opened the account or made a specific contribution. If you opened a Roth IRA on December 15, 2024, and made your first contribution that same month, your five-year period began on January 1, 2024. By January 1, 2029, you will have satisfied the holding period.

This rule applies across all Roth IRAs you own. If you have three separate Roth IRAs at three different institutions, they all share the same five-year start date. You do not reset the clock by opening a new account or rolling money between accounts. The clock runs from your first Roth contribution, period.

The holding period is separate from the age requirement. You can satisfy the five-year rule at age 35 and still not withdraw earnings penalty-free until 59½. Conversely, you can turn 59½ at age 40 (which is impossible, but illustrates the point) and still need to wait for the five-year period to close. Both conditions must be true.

Exceptions that let you access earnings before 59½

The IRS allows penalty-free withdrawals of earnings before 59½ in four situations: a first-time home purchase, a may have access to disability, unreimbursed medical expenses, and education costs. In each case, the 10 percent penalty is waived, but income tax on the earnings still applies unless the five-year holding period has been met.

First-time home purchase: You can withdraw up to $10,000 in earnings (lifetime limit) to buy, build, or rebuild a primary residence. "First-time" means you have not owned a home in the past two years. You must use the money within 120 days of withdrawal.

Disability: If you become disabled as defined by the Social Security Administration, you can withdraw earnings without the 10 percent penalty. Income tax still applies. The disability must be expected to last until death or be of indefinite duration.

Medical expenses: You can withdraw earnings to cover unreimbursed medical expenses that exceed 7.5 percent of your adjusted gross income in that tax year. The expenses must be for you, your spouse, or your dependents.

Education: Withdrawals for may have access to education expenses—tuition, fees, books, supplies, room and board for yourself or a family member attending an accredited school—are penalty-free. Income tax on earnings still applies.

What happens if you withdraw earnings before the five-year period ends

If you withdraw earnings before both the five-year holding period and age 59½ are satisfied, and no exception applies, you owe two things: ordinary income tax on the earnings at your current tax rate, plus a 10 percent early withdrawal penalty on top of that.

Example: You open a Roth IRA on March 1, 2024, and contribute $7,000. By December 2024, the account has grown to $7,500. You withdraw $7,500 on January 15, 2025, at age 45. The first $7,000 comes out tax-free as a contribution. The remaining $500 is earnings. Because you have not reached 59½ and the five-year period has not closed, you owe income tax on the $500 plus a $50 penalty (10 percent of $500). The tax rate depends on your overall income that year.

The penalty is calculated on the earnings amount, not the total withdrawal. If you withdraw $10,000 in contributions and $500 in earnings, the penalty applies only to the $500.

Roth conversions and the pro-rata rule

If you have converted money from a traditional IRA to a Roth IRA, the withdrawal rules become more complex. A conversion is when you move pre-tax money from a traditional IRA into a Roth and pay income tax on it in that year. The converted amount is treated as a contribution for withdrawal purposes, but only the portion you paid tax on is truly "contribution basis."

Converted amounts have their own five-year holding period. Money you converted in 2024 cannot be withdrawn penalty-free (as a conversion) until 2029, even if your original Roth IRA opened earlier. However, you can always withdraw your actual contributions—the money you put in directly—without waiting.

If you have both a traditional IRA and a Roth IRA and you convert part of the traditional IRA, the IRS applies the pro-rata rule. This rule treats all your traditional IRAs as one pool for tax purposes. If 80 percent of your combined traditional IRA balance is pre-tax money, then 80 percent of any conversion is treated as pre-tax, even if you converted from an account that was mostly after-tax contributions. This can create unexpected tax bills and is worth discussing with a tax professional before converting.

Inherited Roth IRAs and beneficiary withdrawal rules

If you inherit a Roth IRA from someone other than your spouse, you cannot treat it as your own. The withdrawal rules depend on whether the original account owner had reached 59½ and satisfied the five-year holding period at the time of death.

If the original owner met both conditions, you can withdraw earnings tax-free. If the original owner had not met both conditions, earnings are taxable to you when you withdraw them, though the 10 percent penalty does not apply to beneficiaries.

As a non-spouse beneficiary, you must begin taking distributions from the inherited Roth by December 31 of the year following the death. The timeline depends on whether the original owner had begun taking required minimum distributions. A tax professional can help you understand your specific situation, as the rules changed significantly under the SECURE Act of 2023.

If you inherit a Roth IRA from your spouse, you have the option to treat it as your own, which gives you more flexibility on withdrawals.

Frequently Asked Questions

Can I withdraw my contributions without reporting it to the IRS?

You do not owe income tax on contributions, but you should still report the withdrawal on your tax return if you file one. The IRS tracks Roth accounts through Form 5498, which your custodian sends each year. Withdrawals are reported on Form 8606. Reporting is straightforward and shows the IRS you understand the contribution-versus-earnings distinction.

What if I do not know how much I have contributed versus earned?

Your Roth IRA custodian (the bank or brokerage holding the account) can provide a statement showing your contribution basis. Request this before you withdraw. If you have made contributions over many years or rolled money between accounts, the custodian's records are the authoritative source. Do not estimate.

Does a Roth conversion count as a contribution for the five-year rule?

A conversion has its own five-year holding period separate from your original Roth IRA. Money you converted in 2024 cannot be withdrawn penalty-free until 2029, even if your Roth opened in 2020. However, you can always withdraw your direct contributions (money you put in yourself) without waiting for any five-year period.

What if I turn 59½ before the five-year period ends?

You still cannot withdraw earnings penalty-free. Both conditions must be met: you must be 59½ and the account must have been open for five tax years. If you turn 59½ in year three, you wait until year five to withdraw earnings without penalty.

Can I withdraw earnings for a child's college costs without penalty?

Yes, if the expenses are may have access to education costs for you, your spouse, a child, or a grandchild. The 10 percent penalty is waived, but income tax on the earnings still applies unless the five-year holding period has closed. The education exception does not waive the tax, only the penalty.