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Message
Question about early Roth distributions
Posted on 5/11/13 at 2:52 pm
Posted on 5/11/13 at 2:52 pm
My Roth is already fully funded for 2013.
I have an unexpected expense coming up next month, can I withdraw up to my 2013 contribution now, and then "recontribute" it by the end of the year?
Seems simple enough, Just want to make sure there is nothing I'm missing.
I have an unexpected expense coming up next month, can I withdraw up to my 2013 contribution now, and then "recontribute" it by the end of the year?
Seems simple enough, Just want to make sure there is nothing I'm missing.
2
Posted on 5/11/13 at 3:16 pm to jso0003
2013 contributions are only locked in on April 15 2014. .
You can withdraw and recontribute to your heart's content prior to that point. You can even over contribute as long as you pull out the excess of 5500 before April 15
You can even withdraw earnings made on this year's contributions penalty free, but I wouldn't advise it. Not going to be much compared to the risk of paperwork headache with the IRS.
Note that all this is independant of taxes.
You can file your taxes next year before recontributing to the Roth.
(This thread reminds me why I love my Roth.)
You can withdraw and recontribute to your heart's content prior to that point. You can even over contribute as long as you pull out the excess of 5500 before April 15
You can even withdraw earnings made on this year's contributions penalty free, but I wouldn't advise it. Not going to be much compared to the risk of paperwork headache with the IRS.
Note that all this is independant of taxes.
You can file your taxes next year before recontributing to the Roth.
(This thread reminds me why I love my Roth.)
This post was edited on 5/11/13 at 3:21 pm
Posted on 5/11/13 at 4:12 pm to Siderophore
quote:
You can even over contribute as long as you pull out the excess of 5500 before April 15
What about the earnings? Seems to good to be true.
Posted on 5/11/13 at 4:31 pm to TigerDeBaiter
quote:
You can even withdraw earnings made on this year's contributions penalty free, but I wouldn't advise it. Not going to be much compared to the risk of paperwork headache with the IRS.
Why does it sound too good to be true?
It's just treated the same as a taxable account, with earnings taxed as short term capital gains rate (as you've held it for less than a year)
Posted on 5/11/13 at 6:20 pm to Siderophore
You quoted something different, but my interpretation of my original question was.
So I can deposit $100k in May, earn $15k on it throughout the year, and as long a I take out $94,500 by April I'm all square with the my taxes? This is what seemed to good.
So I can deposit $100k in May, earn $15k on it throughout the year, and as long a I take out $94,500 by April I'm all square with the my taxes? This is what seemed to good.
Posted on 5/11/13 at 7:07 pm to TigerDeBaiter
quote:
You quoted something different, but my interpretation of my original question was.
Yeah, I quoted the part I already said in the post that you pulled your quote from that answered your question.
quote:
So I can deposit $100k in May, earn $15k on it throughout the year, and as long a I take out $94,500 by April I'm all square with the my taxes? This is what seemed to good.
You'll have to pay whatever your marginal tax rate is on the 15k, the same as if it were on a taxable account, but yeah.
Your broker might limit you, but the IRS ONLY cares about your balance on April 15.
You can add more, take out, add more, repeat ad neasam.
It only gets locked in on April 15th.
Posted on 5/11/13 at 7:47 pm to jso0003
You can do a 90 day ( I think 90 but it might be 60) day "loan" and not pay a penalty once every 12 months.
I'm not sure about some of the other rules.
I'm not sure about some of the other rules.
Posted on 5/11/13 at 9:25 pm to Jp1LSU
I have no idea what you could be referring to.
Posted on 5/12/13 at 9:22 pm to TigerDeBaiter
quote:
What about the earnings? Seems to good to be true.
You can pull out any amount up to what you *contributed* at any time without penalty because you already paid taxes on it.
Pulling out anything more than that (e.g. earnings on contributions) is another matter.
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