You can withdraw your contributions anytime, but earnings have strict rules

A Roth IRA lets you take out the money you put in — your contributions — whenever you want, with no age limit and no tax penalty. The earnings those contributions generated are different: you cannot touch them before age 59½ without paying income tax and a 10% penalty, with a few narrow exceptions. The account must also have been open for at least five years before you withdraw earnings, even if you are over 59½.

The five-year rule is per account, not per person. If you open a Roth IRA today and convert money from a traditional IRA into it tomorrow, that five-year clock starts over for the converted amount. This matters because conversions are treated differently from regular contributions.

Key Takeaways

  • You can withdraw contributions (the money you deposited) from a Roth IRA at any age without penalty or tax.
  • Earnings cannot be withdrawn before age 59½ unless you meet a specific exception like disability, death, or a first-time home purchase up to $10,000.
  • The account must be open for five tax years before you can withdraw earnings tax-free, even after age 59½.
  • Contributions and earnings are tracked separately by the IRS, so you need records showing how much you put in versus how much the account earned.

How contributions and earnings are treated differently

The IRS separates your Roth IRA into two buckets: what you contributed and what it earned. When you withdraw, contributions come out first. This is called the "ordering rule." If your account has $50,000 and $30,000 of that is your contributions, you can withdraw the $30,000 anytime with no tax or penalty. The remaining $20,000 in earnings stays locked until you meet the age and five-year requirements.

Your Roth IRA custodian (the bank or brokerage holding the account) does not automatically track this split for you. You need to keep records of every contribution you made, including the year and amount. If you converted money from a traditional IRA, that conversion amount is also tracked separately and has its own five-year rule. The IRS Form 8606 is where you report conversions and track the taxable portion.

Withdrawals before age 59½ with exceptions

Even though earnings are normally locked until 59½, the IRS allows withdrawals in specific situations. You can withdraw earnings without the 10% penalty (though you still pay income tax on them) if you are disabled, if the money goes to a beneficiary after your death, or if you use up to $10,000 toward a first-time home purchase. "First-time" means you have not owned a home in the past two years — it does not mean you are buying your first house ever.

Other exceptions exist but are narrower. You can withdraw earnings to pay unreimbursed medical expenses above 7.5% of your adjusted gross income, or to pay health insurance premiums while unemployed. You cannot withdraw earnings early to pay for education, even though traditional IRAs allow it. If you do not meet one of these exceptions and withdraw earnings before 59½, you owe income tax on the earnings plus a 10% penalty.

The five-year rule for earnings

Even if you turn 59½ tomorrow, you cannot withdraw earnings tax-free unless the account has been open for five tax years. The clock starts January 1 of the year you open the account or make your first contribution. If you opened a Roth IRA on December 15, 2023, the five-year period runs through December 31, 2028. On January 1, 2029, you can withdraw earnings tax-free (assuming you are also 59½).

Conversions from traditional IRAs have their own five-year clock. If you converted $50,000 in 2024, that converted amount cannot be withdrawn earnings-free until 2029, separate from when you opened the account. This rule applies even if you are already over 59½ when you convert. The five-year rule exists to prevent people from using conversions as a backdoor way to access retirement money early.

What happens if you withdraw too early

If you withdraw earnings before age 59½ and do not meet an exception, the IRS taxes the earnings as ordinary income and adds a 10% penalty. The penalty applies to the earnings only, not to your contributions. If you withdrew $15,000 and $5,000 of it was earnings, you owe income tax on the $5,000 plus a $500 penalty (10% of $5,000). Your tax rate determines the actual tax bill — it could be 12%, 22%, or higher depending on your total income that year.

You report the withdrawal on IRS Form 8606 when you file your tax return. The form shows how much you withdrew, how much was contributions versus earnings, and whether you may have access to for an exception. If you made a mistake — say you withdrew thinking you met the five-year rule but did not — you can request a waiver of the penalty in some cases, though the IRS is strict about this.

Withdrawals at age 59½ and older

Once you turn 59½ and the account has been open for five tax years, you can withdraw contributions and earnings tax-free and penalty-free. There is no required minimum distribution (RMD) from a Roth IRA during your lifetime, unlike traditional IRAs. You can leave the money in the account as long as you want, and it keeps growing tax-free. This is one reason Roths are useful for leaving money to heirs — the account can compound for decades.

If you inherit a Roth IRA from someone else, the rules change. Beneficiaries must withdraw the entire account within ten years (as of 2024 rules), though they do not owe income tax on the withdrawals if the original owner had the account open for five years. The five-year rule applies to the original owner's account, not to when you inherited it.

Keeping records for withdrawals

Your Roth IRA custodian sends you a statement each year showing contributions, earnings, and the account balance. Keep these statements. When you withdraw, the custodian will ask you which type of withdrawal you want — contributions or earnings — and will report it to the IRS on Form 5498-R. You need your own records to prove how much you contributed over the years, especially if you opened the account years ago and lost track.

If you cannot find old statements, contact your custodian and ask for a contribution history. Most brokerages can pull this from their records. The IRS also has a record of contributions you reported on Form 8606 in prior years. Without clear records, the IRS may assume more of your withdrawal is earnings than it actually is, which could cost you in taxes and penalties.

Frequently Asked Questions

Can I withdraw my contributions if I have not had the account for five years?

Yes. The five-year rule applies only to earnings, not contributions. You can withdraw what you put in at any time, at any age, with no tax or penalty. Only the earnings are locked until age 59½ (or until an exception applies).

What counts as a contribution versus earnings?

A contribution is money you deposited directly into the Roth IRA from your paycheck or bank account. Earnings are the investment gains — stock appreciation, dividends, interest. Conversions from traditional IRAs are tracked separately. Your custodian statement shows the account value, but you need your own records to know how much you contributed.

If I withdraw earnings early and pay the penalty, can I put the money back?

You can deposit money back into the Roth IRA up to your annual contribution limit, but that does not undo the withdrawal or erase the penalty you already paid. The IRS does not refund penalties for early withdrawals. You would need to file an amended return and request a penalty waiver, which is rarely granted unless you have a strong reason.

Does the five-year rule reset if I roll over money from another Roth IRA?

No. A rollover from one Roth IRA to another does not restart the five-year clock. The clock is based on when you first opened any Roth IRA, not on individual accounts. Conversions from traditional IRAs do have their own five-year clock, separate from regular contributions.

What if I am disabled — can I withdraw earnings early?

Yes. If you are disabled (as defined by the IRS), you can withdraw earnings before age 59½ without the 10% penalty, though you still owe income tax on the earnings. You will need to provide proof of disability to the IRS if questioned. The five-year rule still applies — if the account is less than five years old, you cannot withdraw earnings tax-free even with disability.