Corrcet, Roth IRA CONTRIBUTIONS can be removed tax and penalty free at
any time.

wessnjoe[at]netscape.net wrote:
- quote -

"Rich Carreiro" <rlcarr[at]animato.arlington.ma.us> wrote
- quote -

One may take a "bridge loan" from a Roth IRA (borrowing only the amount of one's
contributions) for a period of up to 60 days. One may do this no more than once
a year.

For example:
Suppose Wess has conributed $7000 to his Roth IRA to date. On May 1st, 2004 he
withdraws $7000 (without penalty) from his Roth IRA. He then writes a check back
to his Roth IRA account for $7000 by June 29. This series of transactions will
have no effect on what he may contribute to his Roth IRA for 2004.

The next time Wess can take another "bridge loan" from his Roth IRA is May 1st,
2005.

See http://www.tdwaterhouse.com/planning...pping_ira.html
, among other sites.

wessnjoe[at]netscape.net writes:

- quote -

That is correct for annual *contributions*.

However, traditional IRA to Roth IRA *conversions* carry a 10% penalty
(but are still tax-free) if they are withdrawn within five tax years
of the tax year in which the conversion occurred.

- quote -

All earnings, however derived, will be taxable and penalizable
if you are under age 59.5 regardless of how many years you've
had a Roth IRA (unless you meet one of the penalty waivers).

Unlike traditional IRAs, Roth IRAs are subject to (favorable
to the taxpayer!) ordering rules.

A withdrawal is first deemed to be a withdrawal of annual
contributions, until you've withdrawn more than all the
annual contributions you've ever made. At that point, a
withdrawal is deemed to be a withdrawal of conversions,
until you've withdrawn all the conversions you've ever
made, and then at that point withdrawals are deemed to
be withdrawals of earnings.

- quote -

No.

- quote -

*Yes*, it does.

--
Rich Carreiro rlcarr[at]animato.arlington.ma.us

Hi all, and thanks in advance...

I am *guessing* that because my contributions to a ROTH IRA are
available for my use at any time without penalty, becuse I've
already paid all the taxes on them. I assume that all interest,
dividend or other income from my donations has to stay in the ROTH
for the 5 years etc, but my contributions are available any time.

Am I wrong?

My intent is to store my 3-months salary 'safety net' in a Roth,
for tax-free growth, and only withdraw in the near future if I
run into an emergency.

Also, (If I am correct), can I replenish a principal withdrawal
without concern, or does any replenishment count against the
yearly maximum contribution?

Thanks,
Leslie Green

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