Distributions may be subject to a 10% federal early-withdrawal penalty unless distributions are made:

• Subject to a qualified rollover or transfer.
• After age 59½.
• Because of contributor's death or disability.
• To pay for qualified higher education expenses.
• To pay qualified first-time homebuyer expenses.
• To pay health insurance premiums for certain unemployed persons.
• To pay certain medical expenses.
• As substantially equal periodic payments over contributor's life expectancy or joint life expectancy with beneficiary.
• Pursuant to an IRS levy issued after Dec. 31, 1999.

Withdrawals of contributions are federal income tax-free and penalty-free.
Withdrawals of earnings, may be tax-free and penalty-free if both

• Made after five years.
• Made on or after the date you reach age 59½; Made because you are disabled; Made to a beneficiary or to your estate after your death; or One that meets the requirements listed under first home under Exceptions in chapter 1 (up to a $10,000 lifetime limit).