The five-tax-year period (that determines whether a Roth distribution is a “qualified distribution”) begins with the first tax year for which the individual made a contribution to a Roth IRA.

An IRA contribution for any tax year can be made by the April due date of the return in the subsequent year. Thus, if the first regular contribution (i.e., non-rollover) is made as late as the actual return due date for the tax return, the prior year would be the first year of the 5-year qualifying period.

The 5-year period ends on the last day of the individual's fifth consecutive tax year beginning with the tax year described above (Reg § 1.408A-6, Q&A 2).

The initial deposit starts the five-tax-year holding periods for all subsequent deposits. Thus, once the five-tax-year holding period has been met, any distribution from the Roth IRA, even one allocable to contributions made within five years before the distribution, may be excludable as a qualified distribution, except for: