I'm 67. Can I withdraw Roth IRA earnings early? - The Help Desk ...

I know that withdrawals on earnings in a Roth IRA are non-taxable once the IRA is over five years old. If I fund a Roth IRA now, do I still need to wait five years before earnings withdrawals are tax-free, since I am 67 and already at retirement age? ? Dan B.

Although 59 ? is?the age after which most people can withdraw Roth IRA earnings tax-free, no matter what your age, you must wait five years after opening a Roth to avoid those taxes. "Putting money in a Roth basically assumes you won't need that money for five years," says Keith Amburgey, a CFA and principal of Rutherford Asset Planning in Tampa, Fla. You can withdraw regular contributions (not conversions from a traditional IRA) at any time ? just not the earnings on those contributions.

If you expect to need ready access to all your money, you may be better off contributing those funds to a traditional IRA, says Amburgey. But if you can afford to wait the five years, the Roth is a great choice. Reason: Unlike traditional IRAs, Roth IRAs aren't subject to required minimum distributions at age 70 ?. You'll no longer be able to contribute to the Roth past that age, but your assets can continue to grow tax-free for as long as you want ? even if you decide to pass those assets to your heirs.

? Austin Kilham

Got a question for the Help Desk? Send it to?helpdesk@cnnmoney.com.

Source: http://helpdesk.blogs.money.cnn.com/2012/07/27/withdraw-roth-ira-earnings-early/

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