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Subject:  Re: Roth IRA Date:  2/4/1998  6:37 PM
Author:  TMFPixy Number:  1629 of 88052


<<It's my understanding that for a contributory ROTH you
can withdraw contributions tax free and penalty free
at any time and for any reason.

This flexibility makes a ROTH more attractive for a 15
year old. If the money is needed for tuition in 3-7 years
or for a house in 10-15 years the contributions can be
used tax free, the earnings are still a nice jump start
to retirement. (After 3-7 years the contributions will still
be most of the value of the ROTH)>>

As to contributions, you're absolutely correct. And therein lies your fatal error. Contributions will not be counted as a distribution for the first home or education use exceptions. Those kinds of withdrawals will come from earnings exclusively when taken from a Roth. Thus, those two early withdrawals have zip to do with contribution withdrawals in this context.

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