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I have a need to consider the option of dipping into my Roth IRA for a business expense that wouldn't qualify as one of the allowable conditions for early withdrawal without a penalty. I remember reading somewhere that it is possible to take money out of a Roth temporarily in certain situations, provided the money was put back in within a certain time, and that the money didn't represent the actual contributions, etc. Was that information correct, and if so what are the conditions for doing this?

Greetings, 5000fingers, what Phil said. What you are thinking of doing is called a ROLLOVER and you are allowed to do it I think once a year (but Pub 590 should have the real scoop on it). You can take out the proceeds so long as you put every penny of them back within 60 days. I did this to put a downpayment on my house while waiting for the borrowed funds to become available and I scooted the money back into my Roth with well over a week to spare. Depending on where your Roth is usually held (mine was at a full service broker), there are even specific forms to indicate that you are withdrawing the funds as a rollover and that you are later putting them back as part of the rollover. If you can meet the requirements for doing this and won't get caught short, then it seems like a reasonable way of securing the needed funds. What I don't recall is whether you are allowed to take out any of the earnings or if what you temporarily take out can come only from your initial contributions, but Pub 590 should be more explicit about this.

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