Direct contributions — which, again, are after-tax — can be withdrawn at any time penalty-free. The earnings, though, must remain untouched to avoid the penalty (and taxes). For money that's converted to a Roth IRA, you can avoid the penalty as long as you leave it alone for five ...
Compare and contrast a traditional IRA vs. a ROTH IRA. Determine which is tax-deferred or can be tax sheltered and explain. Which of the following 401K plans allow for the tax deductibility of earnings (investment returns)? a) 401K Roth b) 401K Traditional c) Defin...
Earnings can be withdrawn if you are 59 1/2 or older and have held the Roth IRA for at least five years.Upon conversion, earnings and deductible contributions to the traditional IRA are taxed as ordinary income. But in 2010 for conversions only, the tax liability can be spread out over ...
It's never too early to start saving for those college bills. And it's no surprise the Congress has included some tax goodies to help parents save. One option is a Section 529 Education Savings Plan. Contributions to these plans are not deductible on your federal taxes, but earnings grow ...
Many people are surprised to learn that Social Security income and unemployment income are taxed. There are some additional reporting requirements as well. Your broker is required to include your cost basis, so that when you sell a stock, your gains can be more easily figured out. That way,...
Taxes:It’s important to remember that dividend income is taxed if the shares are held in taxable brokerage accounts. To avoid this, you might consider owning the shares through a tax-advantaged account like a traditional orRoth IRA.
Distributions from a mutual fund are taxed, whether they're paid out in cash or reinvested. Your brokerage should provide you with IRS Form 1099-DIV after the end of the calendar year. start making qualified distributions Click here to view interactive content ...
"Withdrawals from Roth IRAs are a little tricky. Before retirement, you will only be taxed on earnings made on top of your contributions. For example, if 80% of your Roth IRA is made up of contributions, while the rest is made up of earnings, then only 20% of each withdrawal will be...
The wayindividual retirement account (IRA)withdrawals are taxed depends on the type of IRA. For example, you'll always pay taxes on traditional IRA withdrawals. However, with a Roth IRA, there is no tax due when you withdraw contributions or earnings, provided you meet certain requirements. Ea...
You're never too old to fund a Roth IRA. Opening a later-in-life Roth IRA means you don't have to worry about the early withdrawal penalty on earnings if you're 59½. No matter when you open a Roth IRA, you have to wait five years to withdraw the earnings tax-free. ...