Traditional and Roth IRA withdrawals compared
Different types of IRA withdrawals can have different federal tax treatment. The table below shows the general rules for traditional and Roth IRA distributions.
| Withdrawal | General federal tax treatment |
|---|---|
| Traditional IRA with only deductible contributions | Withdrawal is taxable as ordinary income |
| Traditional IRA with nondeductible contributions | Part of the withdrawal may be tax-free |
| Qualified Roth IRA distribution | Tax-free |
| Nonqualified Roth IRA distribution | Some amounts, particularly earnings, may be taxable |
Source: Internal Revenue Service
How traditional IRA withdrawals are taxed
Traditional IRA withdrawals include taxable income when they consist of deductible contributions and investment earnings. The taxable amount is added to your other taxable income for the year and taxed under the ordinary federal tax brackets.
For example, using 2026 thresholds, let’s say your other taxable income for the year is $95,000, and the 22% bracket ends at $105,700 since you’re a single filer. If you withdraw $15,000 from a traditional IRA, the first $5,700 of that withdrawal is taxed at 22%, and the remaining $4,300 falls into the 24% bracket:
$5,700 × 22% = $1,254
$4,300 × 24% = $1,032
Total tax on the withdrawal: $2,286
As you can see, moving into the higher bracket doesn’t cause the entire withdrawal or your other income to be taxed at 24%—only the portion that falls above the threshold does.
You’ll receive Form 1099-R (used to report withdrawals and distributions of $10 or more) showing your total distribution.
Roth IRA withdrawal rules
A qualified Roth IRA distribution is tax-free. Generally, the Roth IRA must satisfy the five-year rule (you’ve had the account for five years) and the distribution must be made:
- At age 59½ or older
- Because of disability
- To a beneficiary or estate after the owner’s death
- For a qualifying first-home purchase, subject to a $10,000 lifetime limit
Roth IRA regular contributions come out before conversions and earnings under IRS ordering rules. The return of your regular contributions isn’t included in gross income. If you don’t meet these conditions, only your original contributions come out tax-free—earnings may be taxed and penalized.
Additional tax on early IRA withdrawals
Taxable IRA distributions taken before age 59½ may be subject to a 10% additional tax on top of regular income tax.
Exceptions may apply for:
- Higher education expenses
- First-home purchases
- Medical expenses
- Birth or adoption expenses
- Emergency personal expenses
- Disability or terminal illness
Distributions could still be subject to regular income tax, even when one of these exceptions eliminates the 10% additional tax.
Nondeductible traditional IRA contributions
If you’ve made nondeductible traditional IRA contributions, you’ve already paid income tax on that basis. An IRA withdrawal is divided between taxable and nontaxable amounts rather than letting you withdraw only the after-tax dollars.
Form 8606 is used to track your basis and calculate the taxable portion of the distribution.
