If I withdrew Roth IRA funds of amounts I contributed four years ago, why am I being charged IRA withdraw penalties now?

You must have a Roth IRA for five years before you can take a qualified distribution. It doesn’t have to be the same Roth IRA as the one you’re withdrawing from.

The five-year period starts on Jan. 1 of the first tax year you opened and funded a Roth IRA. It ends five years later on Dec. 31. This is a lifetime qualification. So, after you meet the holding-period requirement once for the first Roth IRA you own:

• You’ll have met the holding periods for all Roth IRAs you own.
• Regarding IRA withdraw penalties, you can take out earnings tax-free and penalty-free after age 59 1/2 — or earlier if you qualify for a Form 5329 exception.

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