Pre-59-1/2 Distribution of Converted Roth IRA
I have a client who, 14-15 years ago, converted $55,000 of his Trad Rollover IRA to a Roth Rollover IRA. Now he needs some money and has yet to reach age 59-1/2. I know that (as long as the account is 5 years old) you can always withdraw your Roth contributions, pre-59-1/2, and do so penalty and tax-free. Is the $55,000 that he converted to a Roth Rollover IRA eligible to be withdrawn, penalty and tax-free…again, pre-59-1/2?
Thanks in advance for help.
Permalink Submitted by Alan - IRA critic on Thu, 2021-05-13 23:59
Yes, because the conversion was done over 5 years ago, the conversion holding period is over. The entire 55000 can be distributed tax and penalty free. However, any regular contributions he might have made and any conversions older than this one come out first, also tax and penalty free. What would not be tax and penalty free is distributing any gains on that conversion before 59.5