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Qualified Distribution

Qualified Distribution Definition

Qualified Distribution refers to tax and penalty free withdrawals of earnings from a Roth IRA account. In order to be a qualified distribution, the withdrawal has to meet the following requirements:

1. The distribution is made at least five years after the Roth IRA was established. The beginning of the 5-year period is the first taxable year for which a contribution was made.

2. At least one of the following requirements must be met:

  • The payment is made on or after the holder reaches age 59½.
  • The payment is made after the holder becomes disabled.
  • A distribution limited to $10,000 is used towards the purchase of a first home for the holder or a qualified family member.
  • The payment is made to the beneficiary of the holder after his/her death.








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