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http://boards.fool.com/vtaeger-ltltits-my-understanding-that-for-a-10097928.aspx
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| Subject: Re: Roth IRA | Date: 2/4/1998 6:37 PM | |
| Author: TMFPixy | Number: 1629 of 74001 | |
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Vtaeger, <<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. Regards....Pixy |
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