Want to boost your retirement savings and lower your taxes? A Roth IRA is a way for investors to do just that. But tax-free growth potential and tax-free withdrawals are just two benefits of a Roth. Here are three lesser-known advantages.

1. Use your contribution dollars at any time
We typically focus on the saving and investing aspects of Roth IRAs. But a Roth IRA enables you to take out 100% of what you've contributed at any time and for any reason, with no taxes or penalties. Only earnings in the Roth IRA are subject to restrictions on withdrawals. A distribution of earnings from a Roth IRA is tax-free and penalty-free if the account has been owned for five years and at least one qualifying condition is met. However, distributions of earnings are taxable if one of these conditions is not met and the five-year holding requirement hasn't been satisfied.

2. No required minimum distributions
Unlike Traditional IRAs and employer-sponsored retirement plans, Roth IRAs do not impose required minimum distributions, or RMDs, during the lifetime of the original owner. If you don't need your RMDs for essential expenses, they can be a nuisance. RMDs must be calculated each year and result in taxable income. Also, if you miss taking one, you'll incur a hefty penalty. Owning a Roth IRA gives you piece of mind knowing you don't have to deal with RMDs.

3. Leave tax-free money to heirs
Because Roth IRAs don't require RMDs during your lifetime, these accounts could potentially grow larger over the years and be passed on to your heirs. But carefully consider the pros and cons before trying to use a Roth IRA for your estate planning. For example, if you plan to leave your retirement savings to your heirs, consider how it may affect their taxes. RMDs from inherited Traditional IRAs generate taxable income for heirs and could push them into a higher tax bracket. If your heirs' income tax rates are expected to be lower than yours, they may be better off inheriting a Traditional IRA rather than a Roth IRA. Also, note that while RMDs are required for inherited Roth IRAs, those distributions generally remain tax-free. Be sure to consult an estate planning attorney before attempting to use Roth IRAs as part of an estate plan.

Foolish takeaway
Do these lesser-known reasons for owning a Roth IRA entice you? If so, you have until the April 15 deadline to contribute $5,500 (or $6,500 if age 50 or older) to a Roth IRA for 2013. Not everyone can contribute to a Roth IRA because of income limits.  But you still may be able to convert an existing Traditional IRA or other retirement savings account into a Roth.

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Follow Nicole Seghetti on Twitter, @NicoleSeghetti. Try any of our Foolish newsletter services free for 30 days. We Fools don't all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.

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