When you take a distribution from your Traditional IRA, you will pay income taxes on the amount you withdraw at your marginal income tax rate for the year. That means it counts as extra income to you from the government’s perspective. As long as you are over 59.5 years old, there is no penalty for withdrawal. If you are not 59.5 years old, then you will be charged a 10% early distribution penalty.
When you take a distribution from a Roth IRA, you do not pay any income taxes on the amount you with withdraw because you have already paid them. Similar to distributions from a Traditional IRA, there is no penalty for withdrawal if you are over 59.5 years old. If you are not 59.5 years old, then you will be charged a 10% early distribution penalty on any investment earnings in your account. You are always entitled to withdraw your contributions without penalty.