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IRA rules for RMDs & other withdrawals

While you can take money from your IRA anytime, you may bypass penalties and extra taxes if you don't do it too early.

The CARES Act provides a temporary waiver of RMDs for 2020. If you would have had an RMD obligation for 2020, you do not have to take your RMD for 2020 if you don't want to.

If you have already taken a withdrawal in 2020 that would have represented an RMD, you may be eligible to roll the money over within 60 days, subject to IRS rollover rules (including the 60-day rollover deadline and the IRA one rollover-per-365 day rule). Distributions from inherited IRAs are not eligible to be rolled over.

Note: The IRS has extended the 60-day rollover deadline for some distributions, but not all. IRS guidance provides that if the 60-day deadline to complete a rollover ends on or after April 1, 2020, but before July 15, 2020, the rollover deadline is extended until July 15, 2020. If you take an RMD this year and want to roll all or part of the distribution back to an IRA, this extension may provide additional time to complete the rollover. (Please note that this extension does not apply if your 60-day rollover deadline would have ended prior to April 1, 2020.)

For more information about the rollover extension and waivers of the 60-day rollover requirement, go to irs.gov or consult a tax advisor. It's possible the IRS may issue additional clarification in the future regarding rollovers of amounts that would have been RMDs, but for the waiver.

Guidelines for withdrawals

Withdrawals before age 59½

Withdrawals of Roth IRA contributions are always both tax-free and penalty-free. But if you're under age 59½ and your withdrawal dips into your earnings—in other words, if you withdraw more than you've contributed in total—you could be subject to both taxes and penalties on the earnings portion of the withdrawal.

Withdrawals of your traditional IRA contributions before age 59½ will result in a 10% federal penalty tax plus regular income tax on the taxable amount of your withdrawal—generally the entire amount—unless you qualify for an exception.

Withdrawals between ages 59½ & 72 (age 70½ if you attained age 70½ before 2020)

Restrictions relax at age 59½, and you can withdraw from a Roth or traditional IRA penalty-free for the most part.

In addition, with a Roth IRA, you'll pay no taxes on withdrawals, provided your account has been open for at least 5 years.*

With a traditional IRA, you'll owe taxes on the withdrawals of all earnings and any contributions you originally deducted from your taxes.

But remember: Turning 59½ doesn't mean you have to start withdrawing your money.

Withdrawals at age 72 (age 70½ if you attained age 70½ before 2020) & older

If you own a Roth IRA, there's no mandatory withdrawal at any age.

But if you own a traditional IRA, you must take your first required minimum distribution (RMD) by April 1 of the year following the year you reach age 72 (age 70½ if you attained age 70½ before 2020). For each subsequent year, you must take your RMD by December 31. The RMD amount is based on your life expectancy and the prior year-end balance of your retirement account.

Withdrawals from an inherited IRA

In general, nonspouse beneficiaries that inherit an IRA from someone that passed away in 2020 or later may be required to withdraw the entire account balance within 10 years. Spousal beneficiaries and certain eligible nonspouse beneficiaries may be permitted to take RMDs over their life expectancy.

You won't pay taxes on withdrawals from an inherited Roth IRA as long as the original account owner held the IRA for at least 5 years.

But you will pay taxes on withdrawals from an inherited traditional IRA.

A word about loans from your IRA

Neither Roth nor traditional IRAs allow you to take loans, but you can access money from an IRA for a 60-day period through what's termed a "tax-free rollover" as long as you put the money back into the same or a different IRA within 60 days. You're limited to only one such "rollover" within a 12-month period, regardless of the number of IRAs you own.

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Qualifying exceptions

Roth IRAs

Withdrawals of earnings from a Roth IRA before age 59½ may not be subject to the 10% federal penalty tax (or any other taxes) if the IRA has been held for at least 5 years and one of the following applies:

  • The IRA owner is totally and permanently disabled.
  • The IRA owner is using the withdrawal for a first-time home purchase ($10,000 lifetime limit).
  • The withdrawal is made to a beneficiary or the IRA owner's estate after the owner's death.

Withdrawals of contributions are always tax-free and penalty-free.


Traditional IRAs

Withdrawals of both contributions and earnings received from a traditional IRA before age 59½ may not be subject to the 10% federal penalty tax if they occur because:

  • The IRA owner is totally and permanently disabled.
  • The withdrawal is made to a beneficiary or the IRA owner's estate after the owner's death.
  • The withdrawal is made to a reservist who was ordered or called to active duty after September 11, 2001, for more than 179 days.

Or if they're to be used for:

  • A first-time home purchase ($10,000 lifetime limit).
  • Postsecondary education expenses.
  • Substantially equal periodic payments taken under IRS guidelines.
  • Certain unreimbursed medical expenses.
  • An IRS levy on the IRA.
  • Health insurance premiums (after you've received at least 12 consecutive weeks of unemployment compensation).
  • Birth or adoption of a child (up to $5,000 per child distributed within 1 year of birth or adoption).

*These exceptions also apply to any taxable amount of Roth IRA withdrawals.

For additional information about Roth and traditional IRA withdrawal rules, consult:

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Required minimum distributions (RMDs)

Most owners of traditional IRAs and employer-sponsored retirement plan accounts (like 401(k)s and 403(b)s) must withdraw part of their tax-deferred savings each year, starting at age 72 (age 70½ if you attained age 70½ before 2020). If you withdraw less than the RMD amount, you may owe a 50% penalty tax on the difference. Roth IRAs have no RMDs during the owner's lifetime.