Confused about 5 year holding period for withdrawal of Converted funds & gains after age 59-1/2
My IRA & ROTH-IRA are both more than 15 years old. I’m age 65. For the past 3 years I converted funds from my IRA to my ROTH-IRA. I am getting conflicting information whether the 5-year look back window for each conversion applies or not in my situation. I’d like to withdraw the entire amounts of my Conversions AND Gains, but only if I can do so Tax-Free AND Penalty-free. Does each conversion require a 5-year holding period before withdrawals can be made or not? help!
Permalink Submitted by Alan - IRA critic on Mon, 2025-05-05 21:56
Because your Roth is qualified (5 years and over 59.5), the entire balance can be withdrawn without tax or penalty.
Tax code: Sec 408A(d)(3)(F)(i) states that a conversion distributed within 5 years is subject to Sec 72(t), which is the section of the code that applies the 10% penalty.
Sec 72(t)(2)(A)(i) then states that the penalty does not apply to distributions taken after 59.5.
Therefore, all conversion 5 year holding periods all end upon reaching 59.5.