Personal Finance
Specific, sourced answers about retirement accounts, taxes, and everyday personal finance decisions.
3 questions
Can You Withdraw Roth IRA Contributions Before Age 59½ Without Penalty?
Yes — you can withdraw your original Roth IRA contributions (not earnings) at any age, for any reason, tax- and penalty-free, because you already paid tax on that money before contributing it. The rules are different and stricter for withdrawing the account's earnings before age 59½.
What Happens If You Over-Contribute to a Roth IRA?
An excess Roth IRA contribution triggers a 6% excise tax on the excess amount for every year it stays in the account uncorrected. You can avoid the penalty by withdrawing the excess (plus any earnings on it) before your tax filing deadline, or by applying the excess to a future year's contribution limit.
Can You Contribute to a Roth IRA If You Have No Earned Income?
Generally no — IRS rules require you (or your spouse, under a spousal IRA) to have taxable earned income at least equal to the amount contributed. Investment income, pensions, Social Security, and most unearned income do not count, though there is a specific spousal IRA exception for married couples filing jointly.