When do you pay taxes on a Roth IRA?

The tax treatment on withdrawals from a Roth IRA is dependent upon whether the withdrawals are qualified or non-qualified. For distributions to be considered qualified, thereby receiving the tax-free benefit, they must meet the following criteria following at least 5 years after opening their first Roth IRA account:

• The Roth IRA holder is at least 59 ½ years of age
• The assets are used to pay for either a qualifying first home purchase
• The assets are required due to a disability of the account holder

If these criteria are met, withdrawals from the Roth IRA account are treated on a tax free basis.