Solved: Why is my withdrawal from my Roth being partially taxed? It has been in the Roth for several years,
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ray3051
New Member

Why is my withdrawal from my Roth being partially taxed? It has been in the Roth for several years,

 
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Accepted Solutions
IreneS
Intuit Alumni

Why is my withdrawal from my Roth being partially taxed? It has been in the Roth for several years,

Has your Roth been established for 5 years?  Your Roth IRA withdrawals may be taxable if:

  • You’ve not met the 5-year rule for opening the Roth and you are under age 59 1/2 You will pay income taxes and a 10% penalty tax on earnings that you withdraw. The 10% penalty may be waived if you meet one of the exceptions to the early withdrawal penalty tax.
  • You’ve not met the 5-year rule but you are over age 59 1/2: Earnings withdrawn will be included as income and subject to income taxes but will not be subject to a 10% penalty tax.
  • You’ve met the 5-year rule but are not yet 59 1/2: Earnings withdrawn will be considered as income and subject to income taxes and a 10% penalty tax. The 10% penalty may be waived if you meet one of the exceptions listed on page 64 of IRS Publication 590-B - Distributions from Individual Retirement Arrangements


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2 Replies
IreneS
Intuit Alumni

Why is my withdrawal from my Roth being partially taxed? It has been in the Roth for several years,

Has your Roth been established for 5 years?  Your Roth IRA withdrawals may be taxable if:

  • You’ve not met the 5-year rule for opening the Roth and you are under age 59 1/2 You will pay income taxes and a 10% penalty tax on earnings that you withdraw. The 10% penalty may be waived if you meet one of the exceptions to the early withdrawal penalty tax.
  • You’ve not met the 5-year rule but you are over age 59 1/2: Earnings withdrawn will be included as income and subject to income taxes but will not be subject to a 10% penalty tax.
  • You’ve met the 5-year rule but are not yet 59 1/2: Earnings withdrawn will be considered as income and subject to income taxes and a 10% penalty tax. The 10% penalty may be waived if you meet one of the exceptions listed on page 64 of IRS Publication 590-B - Distributions from Individual Retirement Arrangements


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

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dmertz
Level 15

Why is my withdrawal from my Roth being partially taxed? It has been in the Roth for several years,

The last bullet should generally just say "You are not yet 59½."  Meeting the 5-year rule for qualified distributions is irrelevant for anyone under age 59½ unless that person is disabled, deceased, or is using the money for a first-home purchase.
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