Investing - Theory, News & General • Re: Roth 5 year rule for earnings being untaxed

For instance, I thought if I addded 2,000 to a Roth IRA this year that that $2,000 would have to held 5 years until I could withdraw any earnings on it tax free.

I am a little dumbstruck to find that doesn't seem to be the case. I could have been adding Roth money up the wazoo the past 2 decades and not have to wait 5 years once my original Roth account was 5 years old. Since I am about 6 years from age 59.5 I started looking at this closer thinking it was about time to start adding loads of cash to be ready for the 59.5 year event.

This may be one of the biggest epiphanies I found out in awhile. Wish I had learned it sooner so all my Roth earnings could have grown tax free.

The 59.5 age rule is still in effect, so if you contributed this year, you'd have to wait 6 years for the earnings to be tax-free. And if you had done it 20 years ago you'd have to wait 26 years. The 5 year first timers rule is irrelevant for anyone under 54.5, so I don't think your epiphany would've changed anything?

That does help and maybe I wouldn't have added that much more to Roth accounts in younger years since I liked the traditional income tax deductions. But now I know if I stuff $60,000 into my work Roth IRA at age 60, I will not have to wait 5 years to take any earnings out tax free. The work Roth account is over 5 years old.

I really want to lower income taxes in retirement and having hundreds of thousands in Roth is going to help that effort. I might only have a little over 100 k in Roth accounts currently.

Statistics: Posted by MichRoots — Sat Sep 05, 2026 1:37 pm