You can take your contributions out anytime, but earnings have strict rules

A Roth IRA lets you withdraw the money you put in — your contributions — at any time, for any reason, with no tax or penalty. The earnings those contributions grew into are different: you can only touch them penalty-free after age 59½, and only if your account has been open for at least five tax years. Before that, you can still withdraw earnings, but you will owe income tax on them plus a 10 percent early withdrawal penalty in most cases.

The IRS treats contributions and earnings as separate buckets. When you withdraw money, contributions come out first. This means if you put in $5,000 and it grew to $6,000, you can take out $5,000 with no strings attached. If you take out $5,500, that extra $500 counts as earnings and triggers the penalty and tax unless an exception applies.

Key Takeaways

  • You can withdraw your own contributions to a Roth IRA at any time without tax or penalty, regardless of your age or how long the account has been open.
  • Earnings can only be withdrawn penalty-free after you turn 59½ and your account has been open for at least five tax years.
  • Withdrawing earnings before 59½ triggers a 10 percent penalty plus income tax, unless you meet a specific exception like disability, first-time home purchase, or may have access to education costs.
  • The IRS tracks contributions separately from earnings, so withdrawals come from contributions first, protecting you from penalties on the money you actually deposited.
  • Some life events — birth of a child, adoption, or substantial medical bills — have their own withdrawal rules that may let you access earnings earlier.

How the IRS tracks contributions versus earnings

The IRS does not care what you label as a contribution or earning. It uses a formula called the pro-rata rule to figure out what portion of your withdrawal is contributions and what portion is earnings. This matters because it determines whether you owe tax and penalty.

If you have only one Roth IRA, the math is straightforward: add up all your contributions across all years, then subtract what you have already withdrawn. The rest is earnings. If you have multiple Roth IRAs, the IRS treats them as one account for this calculation — you cannot isolate earnings in one account and contributions in another to avoid the penalty.

For example: you opened a Roth IRA five years ago and contributed $6,000 per year for five years, totaling $30,000. The account grew to $38,000. Your contributions are $30,000 and your earnings are $8,000. If you withdraw $32,000, the first $30,000 is contributions (no tax or penalty) and the remaining $2,000 is earnings (subject to tax and penalty unless an exception applies).

Withdrawals before age 59½ with no penalty

The IRS allows you to withdraw earnings early without the 10 percent penalty — though you still owe income tax — if you meet one of these specific situations:

  • You are disabled, as defined by the IRS (unable to work due to a physical or mental condition expected to last at least 12 months or result in death).
  • You are a first-time homebuyer and withdraw up to $10,000 in your lifetime for a down payment, closing costs, or other home purchase expenses.
  • You use the money for may have access to education expenses — tuition, fees, books, supplies, and equipment for you, your spouse, or your dependent at an accredited school.
  • You have substantial medical bills that exceed 7.5 percent of your adjusted gross income in that tax year.
  • You are unemployed and need the money to pay health insurance premiums.
  • You inherit a Roth IRA from someone other than a spouse (different rules explore to inherited accounts).
  • You are the beneficiary of a Roth IRA and the original owner died.

Even when an exception applies, you still owe income tax on the earnings portion of your withdrawal. You avoid only the 10 percent penalty. The exception does not make the withdrawal tax-free.

The five-year rule and when it resets

To withdraw earnings penalty-free at age 59½, your Roth IRA must have been open for at least five tax years. The clock starts on January 1 of the year you first contributed to any Roth IRA, not the year you opened the account.

If you opened a Roth IRA on December 15, 2023, and made a contribution for tax year 2023, the five-year period began on January 1, 2023. You can withdraw earnings penalty-free starting January 1, 2028, as long as you are 59½ by then.

The five-year rule is separate for each type of account. If you convert a traditional IRA to a Roth IRA, that conversion starts its own five-year clock. You can withdraw your original contributions from your original Roth IRA anytime, but converted amounts have their own five-year holding period before you can withdraw the earnings without penalty.

Roth conversions and the pro-rata rule

If you converted money from a traditional IRA or SEP IRA to a Roth IRA, the withdrawal rules become more complex. The amount you converted counts as a contribution for withdrawal purposes, but only after the five-year period for that conversion ends.

The pro-rata rule also applies to conversions. If you have both pre-tax and after-tax money in a traditional IRA, and you convert part of it to a Roth, the IRS calculates what percentage of your conversion was pre-tax versus after-tax. That percentage applies to your Roth IRA withdrawal as well, even if you only converted after-tax money.

This is one of the most confusing parts of Roth accounts. If you are considering a conversion, it helps to understand this rule first, because it can create unexpected tax bills on withdrawals years later.

What happens if you withdraw earnings early without an exception

If you withdraw earnings before age 59½ and do not meet an exception, you owe two things: income tax at your ordinary tax rate, plus a 10 percent penalty on the earnings portion only.

The penalty is calculated on the earnings themselves, not on your total withdrawal. If you withdraw $10,000 and $2,000 of that is earnings, the penalty is 10 percent of $2,000, or $200. You also owe income tax on that same $2,000 at whatever tax bracket you are in.

You report the withdrawal on Form 8606 when you file your taxes. The IRS does not automatically know you took the money out — your brokerage or bank reports it to you and the IRS on Form 5498-R, but that form does not distinguish contributions from earnings. You have to do that calculation yourself or with a tax professional.

Withdrawals after age 59½ and the five-year rule

Once you turn 59½ and your Roth IRA has been open for five tax years, you can withdraw earnings penalty-free and tax-free. This is the main advantage of a Roth over a traditional IRA — may have access to withdrawals are not taxed at all.

You can also withdraw contributions at any time before 59½ with no penalty or tax, so the five-year rule only affects earnings. If you are 59½ but your account has been open for only three years, you can still withdraw your contributions, but earnings are subject to tax and the 10 percent penalty.

Unlike a traditional IRA, Roth IRAs have no required minimum distributions during your lifetime. You never have to take money out, which makes them useful for leaving money to heirs or for people who do not need the income.

Frequently Asked Questions

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

Your brokerage reports all Roth IRA withdrawals to the IRS on Form 5498-R, so the IRS knows you took the money out. However, you are responsible for calculating how much was contributions versus earnings using Form 8606. If you withdraw only contributions, you do not owe tax or penalty, but you still need to report the withdrawal correctly on your tax return.

What if I need money for a reason not on the exception list?

You can still withdraw earnings, but you will owe income tax plus the 10 percent penalty. There is no hardship exception for Roth IRAs the way there is for 401(k) plans. Your only options are to withdraw contributions (always penalty-free) or to meet one of the specific exceptions listed by the IRS.

Do I have to withdraw my contributions in order, or can I pick which years?

The IRS does not let you choose. Withdrawals are treated as coming from contributions first, in the order they were made, then from earnings. You cannot designate a specific contribution year to withdraw from.

If I have two Roth IRAs, can I withdraw from one and leave the other alone?

You can choose which account to withdraw from, but the pro-rata rule treats all your Roth IRAs as one account for tax purposes. If one account is all contributions and another is mostly earnings, withdrawing from the contributions-only account still triggers the pro-rata calculation across both accounts.

What happens to my Roth IRA if I die?

Your beneficiary inherits the account and can withdraw contributions anytime. Earnings have different rules depending on whether the beneficiary is a spouse, a child, or someone else. A spouse can treat the inherited Roth as their own; others must follow specific distribution rules set by the find Act.