Open TurboTax

Why sign in to the Community?

  • Submit a question
  • Check your notifications
or and start working on your taxes
cancel
Showing results for 
Search instead for 
Did you mean: 
laura-y
New Member

We took early withdrawal from Roth IRA that we had owned over 5 years and used it to pay for son's college. Why is it still taking taxes out?

 
1 Best answer

Accepted Solutions
DawnC
Expert Alumni

We took early withdrawal from Roth IRA that we had owned over 5 years and used it to pay for son's college. Why is it still taking taxes out?

Qualified distributions or distributions that are a return of your regular contributions from your Roth IRA(s) are not included in your income.  

 

A qualified distribution is any payment or distribution from your Roth IRA that meets the following requirements.

  1. It is made after the 5-year period beginning with the first taxable year for which a contribution was made to a Roth IRA set up for your benefit, and

  2. The payment or distribution is:

    1. Made on or after the date you reach age 59½,

    2. Made because you are disabled (defined earlier),

    3. Made to a beneficiary or to your estate after your death, or

    4. One that meets the requirements listed under First home under Exceptions in chapter 1 (up to a $10,000 lifetime limit).

There is an exception to the additional 10% penalty for distributions that are less than your qualified higher education expenses.   If you have entered these expenses, you will be able to claim the exception after you enter the 1099-R.  However, this exception is only for the 10% penalty tax, not the ordinary income tax.  

**Say "Thanks" by clicking the thumb icon in a post
**Mark the post that answers your question by clicking on "Mark as Best Answer"

View solution in original post

1 Reply
DawnC
Expert Alumni

We took early withdrawal from Roth IRA that we had owned over 5 years and used it to pay for son's college. Why is it still taking taxes out?

Qualified distributions or distributions that are a return of your regular contributions from your Roth IRA(s) are not included in your income.  

 

A qualified distribution is any payment or distribution from your Roth IRA that meets the following requirements.

  1. It is made after the 5-year period beginning with the first taxable year for which a contribution was made to a Roth IRA set up for your benefit, and

  2. The payment or distribution is:

    1. Made on or after the date you reach age 59½,

    2. Made because you are disabled (defined earlier),

    3. Made to a beneficiary or to your estate after your death, or

    4. One that meets the requirements listed under First home under Exceptions in chapter 1 (up to a $10,000 lifetime limit).

There is an exception to the additional 10% penalty for distributions that are less than your qualified higher education expenses.   If you have entered these expenses, you will be able to claim the exception after you enter the 1099-R.  However, this exception is only for the 10% penalty tax, not the ordinary income tax.  

**Say "Thanks" by clicking the thumb icon in a post
**Mark the post that answers your question by clicking on "Mark as Best Answer"

About Community

Learn about taxes, budgeting, saving, borrowing, reducing debt, investing, and planning for retirement.

3.46m
Members

2.57m
Discussions

Manage cookies
v