How Are Roth IRA Distributions Taxed?

  1. 37376 POINTS
    David G. Pipes, CLU®, RICP®
    Business Development Officer, T.D. McNeil Insurance Services, Fresno, California
    Distributions after age 59.5 on contracts held more than five years are received income tax free. If the distribution is to a beneficiary, it is also income tax free. Under some circumstances the value might be included in an estate tax computation. The basic idea is that the Roth is returning principal that comes from after tax dollars and is not taxable. The interest is merely not charged.
    Answered on September 4, 2014
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