I am 30 years old, and wanna withdraw some money from www.scottrade.com
I contributed some money in my Roth IRA before, but I need to withdraw some money out because of bad economy.
Is there any penalty to withdraw money from Roth IRA? Does the withdraw make some difference on the tax return form? Do I need to put the amount of deposit/withdrawal on my tax return form? I did not put the deposit information on tax return form before.
Thank you very much!
{ 2 comments… read them below or add one }
All withdrawals from Roth IRA’s must be report on your tax forms.
Generally speaking, withdrawals of money that you contributed are tax-free IF you properly report them on the tax form.
Generally speaking, withdrawals after age 59 1/2 are tax-free.
However, if the money was originally in a traditional IRA, 401K, or other non-Roth retirement plan, then withdrawals within a certain number of years after the conversion to Roth may be subject to a 10% penalty.
Generally speaking, withdrawals of earnings before age 59 1/2 are taxable and are subject to ordinary income tax plus a 10% penalty. There are some exceptions.
You will use your records and fill out a worksheet.
Has it been 5 years since you opened the account?
If you limit your withdrawals to LESS than your yearly contributions (and it’s been 5 years), you won’t pay tax or penalty on the money.
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