The basic rule: age 59½ and five years of contributions

You can withdraw your contributions (the money you put in) from a Roth IRA at any time, tax-free and penalty-free. The earnings those contributions grew into are different — you cannot touch those without penalty until you turn 59½ and have held the account for at least five tax years.

The five-year rule starts the moment you open your first Roth IRA, not when you make each individual contribution. If you opened a Roth in 2020, the five-year clock started then, even if you did not fund it until 2021 or 2022.

This distinction between contributions and earnings matters because it is the only way most people under 59½ can access their money without owing taxes and a 10 percent penalty on the growth.

Key Takeaways

  • You can withdraw contributions you personally made at any age without taxes or penalties, but earnings on those contributions are locked until 59½.
  • The five-year holding period applies to your entire Roth IRA account, not to each contribution separately, and begins when you first open the account.
  • Certain hardships — disability, medical expenses, first-time home purchase, and a few others — let you withdraw earnings early without the 10 percent penalty, though taxes still apply.
  • Inherited Roth IRAs follow different rules depending on whether you inherited from a spouse or a non-spouse, and the five-year clock may restart.
  • Roth conversions from traditional IRAs have their own five-year rule that can trap you in penalties if you withdraw the converted amount too soon.

How to tell contributions from earnings

The IRS tracks this through your basis — the total amount of your own money you have put into all your Roth IRAs combined, across all accounts. If you have contributed $50,000 total and your account is now worth $75,000, your basis is $50,000 and your earnings are $25,000.

When you withdraw, you pull contributions first. So in that example, you could withdraw up to $50,000 penalty-free at any age. The $25,000 in earnings stays locked until 59½ (unless an exception applies).

You do not need to track this yourself — the financial institution holding your Roth will know your basis. When you request a withdrawal, they can tell you how much is contributions versus earnings. If you are unsure, ask before you withdraw.

Exceptions that let you withdraw earnings early

The IRS allows you to withdraw earnings before 59½ without the 10 percent penalty in these situations:

  • Disability: You must be unable to engage in substantial gainful activity due to a physical or mental condition expected to last indefinitely or result in death.
  • Death: Your beneficiary or estate can withdraw earnings penalty-free (though taxes still apply to the earnings).
  • First-time home purchase: Up to $10,000 lifetime from all your Roth IRAs combined, for buying, building, or rebuilding a home. "First-time" means you have not owned a home in the past two years.
  • may have access to education expenses: Tuition, fees, books, supplies, and room and board for you, your spouse, or your children or grandchildren attending college or vocational school.
  • Medical expenses: Unreimbursed medical costs that exceed 7.5 percent of your adjusted gross income for the year.
  • Health insurance premiums: If you are unemployed, you can withdraw for your own premiums, your spouse's, or your dependents' premiums.

In all these cases, you still owe income tax on the earnings you withdraw — the 10 percent penalty is waived, but the tax is not. You will report the taxable amount on your tax return for that year.

The five-year rule for Roth conversions

If you convert money from a traditional IRA to a Roth IRA, that converted amount sits under a separate five-year rule. You cannot withdraw the converted amount itself (not the earnings on it, but the principal you converted) for five years without owing a 10 percent penalty, even though you already paid taxes on the conversion.

This is a different five-year clock from the one that unlocks your earnings. A conversion in 2024 cannot be touched until 2029, regardless of when you opened your first Roth. If you convert multiple times, each conversion has its own five-year window.

The earnings generated by a converted amount still follow the original five-year rule tied to your account opening date. This creates a complex situation if you convert early in your Roth ownership — you may be able to withdraw contributions you made directly, but not the converted amount, even though both are in the same account.

Inherited Roth IRAs and the five-year rule

If you inherit a Roth IRA from a spouse, you can treat it as your own or roll it into your own Roth. If you treat it as your own, the five-year rule is based on when you opened your first Roth, not when the original owner opened theirs.

If you inherit from a non-spouse — a parent, sibling, or anyone else — you cannot roll it into your own Roth. You must keep it as an inherited account and take required distributions. The five-year rule for withdrawing earnings is based on when the original owner opened their Roth, not when you inherited it. If they had owned it for five years already, you can withdraw earnings immediately. If not, you wait out the remainder of their five years.

The SECURE Act (passed in 2019) changed how long non-spouse beneficiaries can hold inherited Roth IRAs. Most must empty the account within ten years, though required distributions during those ten years depend on your relationship to the original owner and when they died.

What happens if you withdraw too early

If you withdraw earnings before 59½ and no exception applies, you owe income tax on those earnings plus a 10 percent penalty. The penalty is calculated on the earnings amount only, not your entire withdrawal.

Example: You withdraw $15,000 from your Roth. $10,000 is contributions (no tax or penalty). $5,000 is earnings. You owe income tax on the $5,000 at your regular tax rate, plus $500 in penalties (10 percent of $5,000).

You report this on Form 8606 when you file your tax return. The financial institution may issue a Form 1099-R showing the withdrawal, but it is your responsibility to report the taxable portion correctly. If you made a mistake, you can request a waiver of the penalty from the IRS, though this is not automatic.

Roth IRA withdrawals and required distributions

Unlike traditional IRAs, Roth IRAs do not require you to take distributions at any age during your lifetime. You can leave the money in the account indefinitely and withdraw only what you need.

This is one of the major advantages of a Roth — you have complete control over timing. You can withdraw contributions whenever you want, and once you turn 59½ and meet the five-year rule, you can withdraw everything tax-free and penalty-free, or leave it all in place.

Your beneficiaries, however, will face required distribution rules after they inherit. Non-spouse beneficiaries must empty the account within ten years (with some exceptions for surviving spouses and disabled or chronically ill beneficiaries).

Frequently Asked Questions

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

You do not owe taxes on contributions, so you do not report the withdrawal as income. However, the financial institution holding your Roth may issue a Form 1099-R, and you should keep records showing which portion was contributions. The IRS can audit and ask you to prove your basis.

What if I do not know how much I contributed?

Contact the financial institution holding your Roth IRA. They maintain records of all contributions you made and can provide a statement showing your basis. If you have moved accounts, you may need to contact previous institutions as well.

Does the five-year rule reset if I roll my Roth IRA to a different bank?

No. The five-year clock is tied to your account, not the institution. Rolling your Roth to a new bank does not restart the timer. The five-year period is based on when you first opened any Roth IRA, regardless of how many times you have moved the money.

Can I withdraw earnings if I am under 59½ but have had the account for more than five years?

No. You need both conditions: age 59½ and five years of account ownership. Meeting one without the other means the 10 percent penalty applies to earnings (unless an exception like disability or first-time home purchase applies).

What if I convert a traditional IRA to a Roth and immediately need the money?

You can withdraw the amount you converted without penalty for five years. You already paid taxes on the conversion, so you do not owe taxes again. However, any earnings generated by that converted money are subject to the 10 percent penalty if withdrawn before 59½ (unless an exception applies).