Say a person has a Roth IRA account. Now the money in the Roth IRA account is already post-tax contributions. However, say the person has made a significant capital gains on their Roth IRA investments.
If the person decides to withdraw this amount pre-maturely (i.e. before turning 59+1/2), then are there any tax liabilities and penalties the person is liable for? Will the person have to pay taxes on all the capital gains they have made?
For reference let's consider this scenario: The person had post-tax amount of $10,000 in his/her roth-IRA account. Say with capital gains, this amount has now increased to $30,000. Now the person decides to withdraw $20,000 prematurely from Roth-IRA account. What is the tax/penalty situation here?