Ask The Expert: Withdrawals


Can funds in a ROTH IRA be used to pay for college tuition without any penalties for early withdrawl?

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Yes, as long as your distribution is less than or equal to your "qualified" education expenses (ie, expenses in excess of things like scholarships, employer-sponsored education reimbursements, etc). According to the IRS, eligible expenses "include tuition, fees, books, supplies, and equipment required for enrollment or attendance at an eligible educational institution. They also include expenses for special needs services incurred by or for special needs students in connection with their enrollment or attendance."

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Important Roth Information

Each year, the IRS updates the rules for Roth IRA. Here are all the details for 2015 along with historic numbers for 2014: