Forth ROTH IRA, do we need to wait 5 years to withdraw the original/contribution (NOT earnings)? I thought the 5 year rule only applies to earnings and NOT original principle but I hear mixed stories. I need some clarification.
For example, if I contribute 6000 in 2019 , by 2020 my account grow to 7000. In 2020 I take out only 6000 leaving the 1000 earning in the account . The 6000 (principle) should be tax and penalty free right?
Correct. You can receive a distribution of your original $6,000 of contributions at any time, tax and penalty free.
"Forth Roth IRA" - do you mean this is your fourth Roth IRA and you already have 3 others?
If so, then the 5 year rule is satisfied if you have owned any Roth IRA for 5 years, unless it is a Roth conversion, in which case, each Roth conversion has it's own 5 year clock.
The 5-year rule for qualified distributions is only relevant if the Roth IRA owner is age 59½ or over, disabled, deceased or is using the money to purchase a first home.
Sorry I meant to say for Roth IRA. Not forth...my question was for any Roth IRA contribution