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i thought you could take out contributions to your roth at any time and age as long as you dont take out more than you contributed or is there a 5 year wait?
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Greetings, Billboss, and welcome. You asked:

<<i thought you could take out contributions to your roth at any time and age as long as you dont take out more than you contributed or is there a 5 year wait?>>

There are two types of contributions to a Roth, annual contributions limited to $2K per year and conversion contributions through a transfer of traditional IRAs (no dollar limit). Annual contributions may be withdrawn at any time without tax or penalty. Conversion contributions must remain in the Roth for five tax-years before they can be taken penalty-free.

Regards..Pixy
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I hesitate to ask this, knowing how the IRS thinks, but what about earnings/gains in a mixed conversion/contribution account? If you converted, e.g., $2,000, and contributed $2,000, and found the account to be worth $8,000 one year later, how much could you withdraw without penalty? What if the two components and their gains could be specifically identified?
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TheOthermfa asks:

<< I hesitate to ask this, knowing how the IRS thinks, but what about earnings/gains in a mixed conversion/contribution account? If you converted, e.g., $2,000, and contributed $2,000, and found the account to be worth $8,000 one year later, how much could you withdraw without penalty? What if the two components and their gains could be specifically identified?>>

All Roth contributions, conversions and earnings are aggregated whether held in one or multiple accounts. At withdrawal, distributions are considered to come first from annual contributions, next from conversions on a first-in first-out basis, and last from earnings. In your example, the $2K distribution would be considered as coming from the $2K annual contribution. Take another $2K, and that comes from converted money. Take a third $2K, and that comes from earnings. The latter two withdrawals come under the 5-year and age 59 1/2 rules. Take converted money before it's been in the account five tax-years and when you're younger than age 59 1/2, and it will be penalized 10% (you've already paid the income tax). Take earnings, and you'll be taxed and penalized.

Regards..Pixy
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