Return of Roth IRA contributions before 59 1/2
If a Roth IRA owner takes out their contributions from a Roth IRA prior to 59 1/2, is it taxable.
For example, say owner has put in 10k of a 15k Roth IRA and the owner pulls out 10k when they are age 40, what are the taxes like?
Permalink Submitted by Alan Spross on Thu, 2012-10-11 18:09
There is no tax or penalty for the amount of regular contributions, which can be distributed at anytime.
If the contributions were conversions, there is no tax, but there is a 10% penalty for conversion money held less than 5 years.
Even if there is no tax due, the taxpayer must report the distribution on Form 8606. They would have to know how much they have in regular (or conversion) contributions in total, less whatever amount they took out earlier.