Early Withdrawal

Question: I withdrew $5k from my roth IRA in 06 to purchase a home. Will i have to pay taxes on the $5k?

I thought that if you withrdrew money from an IRA or took a hardship for the purchase of your primary residence that it was not taxable but from doing my taxes via turbo tax, i’m being taxed at approx 37% for the Early Withdrawal. Is this right?
I thought that if you withdrew money from an IRA or took a hardship for the purchase of your primary residence that it was not taxable but from doing my taxes via turbo tax, I’m being taxed at approx 37% for the Early Withdrawal. Is this right? Another piece of information that may be important is that the money was rolled over into the Roth ira from my previous employer plan and I then withdrew it. So I did not directly make those contributions per se.
Oh, yeah, this all took place in 2006. Meaning the IRA was established and the money was rolled over in 2006 from my former employer’s plan. There was no 5 year establishment of the IRA.

Answer: You can withdraw the contributions you’ve made, tax-free.

So if you’ve contributed $5k or more into your Roth IRA, then you shouldn’t get taxed on it.

But if you’ve contributed less, and you only have $5k in there because of gains, then you can get taxed on the difference.

Also, if you converted a traditional IRA into a Roth IRA, the funds you’ve converted are only tax-free after five years.

UPDATE: Did the money transferred into your current Roth IRA come from a 401(k), or was it a Roth 401(k)?

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