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Greeings, Agrahamar, and welcome. You asked:

<<The person I talked to at E-Trade said that if I invest in stocks in an IRA any gains would not be taxable. However, if the account loses money I would be taxed for early withdrawal. Therefore I should probably put my money in mutual funds. That doesn't make sense to me. >>

As well it shouldn't make sense, too, because it is untrue. A loss is not considered a withdrawal. The agent you spoke to must have been smoking some pretty funny stuff to come up with that one. He or she had no idea what they were talking about. As you pointed out, mutual funds can lose money, too.

Let that piece of advice go in one ear and out the other.

Regards..Pixy
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