Author Topic: Roth IRA early withdrawal penalty  (Read 606 times)

JetBlast

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Roth IRA early withdrawal penalty
« on: February 08, 2018, 09:14:35 PM »
So my wife goofed a bit with her investment accounts last year. She meant to withdraw some money from her taxable account but somehow pulled it from her Roth IRA instead. The problem is that the withdrawal exceeded her total contributions to the account by about $2,000. So that portion is considered earnings and subject to taxes and early withdrawal penalty. Ouch!!

However, with my job change last year we had to prioritize our investing and we still have room to make a 2017 contribution to the Roth IRA. Can we contribute $2,000 to the account for the 2017 year so that withdrawal will be considered to be from contributions, or would that be disallowed due to the timing of the withdrawal versus contributions?