If you want to access the funds in your IRA without incurring taxes or penalties, you must wait five years from January 1 of the tax year in which you made your first contribution or reinvestment to a Roth IRA. However, if you need the money urgently, you can try a 60-day IRA renewal. This IRS rule allows you to withdraw money from your traditional IRA and use it for any reason, as long as you return the full amount before the end of the 60 days. You can do this once per 12-month period, and the limit will be applied by adding up all of a person's IRAs, including SEP and SIMPLE IRAs, as well as traditional and Roth IRAs. Another form of direct reinvestment of an IRA is to directly transfer assets between two plans, such as retirement plans.
However, if the transfer was made from a traditional (tax-deferred) IRA to a Roth, you'll also have to declare and pay taxes on the funds (and associated profits) that are being transferred. Nor can you make a transfer during this 1-year period from the IRA to which the distribution was transferred. The IRS may waive the 60-day renewal requirement in certain situations if you missed the deadline due to circumstances beyond your control. To ensure that you don't incur any penalties or taxes, it's important to understand all of the rules and regulations surrounding IRA rollovers and withdrawals.
