However, if you've made nondeductible contributions to your traditional IRA, those aren't taxed when you withdraw them.Similarly, since all Roth IRA distributions are nondeductible, you get those out tax-free but you'll have to pay income taxes on any earnings.
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You pay a 10 percent tax penalty and ordinary income tax on any withdrawals of earnings that you make within five years of first funding the Roth.
Under federal tax laws, you can convert pre-tax retirement accounts such as IRAs or 401ks into Roths.