Did you know that there is a specific order for distributions from your Roth IRA? The Internal Revenue Service has set up a group of rules to determine the order of money, by source, as it is distributed from your account. This holds for any distribution from a Roth IRA account.

Ordering rules

First, return of your annual contribution (or excess contribution) for this tax year. This means that if you’ve made a contribution to your Roth IRA in this tax year, the first money that you withdraw from the account will be the money that you contributed this year. If you over-contributed to your account for a prior tax year, growth on this over-contribution needs to be removed at this time as well (it’s actually counted first), with tax and penalty paid as required.

Second, prior year regular annual contributions to the account. The next money that comes out

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