Roth IRAs are individual saving schemes meant for people with taxable income who meet certain eligibility criteria. They are different from the traditional IRA, in that the contributions made to them are subject to tax deductions, but the earnings themselves are tax-free. This means that the Withdrawals are not subject to taxation. Also, you can have more than one Roth IRA account, but there is a limit to the amount of contributions that you can make in them. Your total contributions in all the accounts cannot exceed $4,000, or 100% of your adjusted gross income, whichever is less.

There are some rules and regulations involved with the Withdrawals of the earnings accrued from these savings. First and foremost, if you have multiple Roth IRA accounts, you can withdraw money from any of the accounts. Yet the Withdrawals themselves have to be made in a certain order, regardless of the account you choose to withdraw from. The order to be followed is: first of all you have to withdraw from the non-taxable annual contributions made to a Roth IRA, followed by Withdrawals from conversion contributions on a first-in, first-out basis, and finally, the Withdrawals can be made from the earnings.

Also, there is a penalty for early Withdrawals. For example, if for some reason you draw money before reaching fifty-nine and half years of age, you will be subject to a ten percent penalty on the amount of Withdrawal. There are, however, exceptions to this rule, including if the Withdrawals have to be made because the individual has suffered some sort of disability. Also, if a person is buying or rebuilding his home for the first time, he or she is exempted from the penalty. There is no penalty involved if the Withdrawal results because of the owners death.