Can Taxable Roth IRA Distributions Be Rolled Over in 60 Days?
Roth IRA distributions are typically not taxable. However, a normally-taxable early distribution may be rolled over to another Roth IRA within 60 days without taxation.
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Rollovers
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A rollover is defined by the IRS as a tax-free distribution of cash or other assets from one retirement plan to another retirement plan.
Qualified Distributions
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Qualified distributions from a Roth IRA, such as withdrawals after age 59½ or rollovers, are not taxable. For Roth IRAs, the owner pays any required taxes on contributions in the tax year they were originally contributed.
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Early Distributions
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Distributions from your IRA account before age 59½ are considered "early," and may be subject to a 10% tax penalty (or 25% for certain withdrawals from SIMPLE IRAs). There are exceptions when the distributions are used to pay for certain things, such as a first-time home purchase or health insurance for the long-term unemployed.
Considerations
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If your Roth IRA withdrawal would be considered an early distribution, you must roll it over to another Roth IRA within 60 days to avoid taxes and penalties. You may also transfer distributions directly from one Roth IRA to another.
Rollover Limitations
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Roth IRA distributions may not be rolled over to Traditional IRAs.
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