The new tax law mainly affects income limits for contributions.
The rules for qualified distributions, including qualified first-time home purchase, remain the same.
Here's a link to the full list of Roth Ira rules from the IRS: IRS Roth IRA Rules
as well as some useful blog posts:
The new tax law mainly affects income limits for contributions.
The rules for qualified distributions, including qualified first-time home purchase, remain the same.
Here's a link to the full list of Roth Ira rules from the IRS: IRS Roth IRA Rules
as well as some useful blog posts:
Thank you Christian, that's very helpful! So I can withdraw $10,000 in earnings plus any contributions, or $10,000 total (earnings + contributions)?
Withdrawing your own previous contributions are *always* tax and penalty free and would not be included in the $10,000 exclusion because your own contributions are not subject to the penalty in the first place. Only the earnings would be taxable and subject to the 10% early distribution penalty - up to $10,000 of the earnings can be exempted from the penalty for a first home if all the conditions are met.
If it has been at least 5 years since the beginning of the year for which you first contributed to a Roth IRA, the exception not only makes a distribution of up to $10,000 of earnings penalty free, it also makes this portion of the distribution tax free as well.
Yes, you can withdraw $10,000 in earnings plus any amounts of your contributions tax and penalty free. To add to macuser_22, you can take out the exact amount of your Roth IRA contributions at any time, for any reason without having to pay any tax or penalty.