Jack writes:I funded a Roth IRA for my daughter, matching herearned income for last year. But then I heard thatcontributions can be withdrawn tax free. Does thismean that she can effectively drain the account andand spend Spring Break in Cancun?Without getting into too much detail you can withdraw funds from Roth IRAs without penalty and tax as follows:Contributions: Five years after the first tax-year a contribution was made. (There are loophole provisions addressing this). Earnings: Five years after the first tax-year a contribution was made and after the date you reach age 59 1/2.Hope this helps.Bob
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