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If the balance in an IRA account falls below the amount of the contributions, is the amount by which it falls below the total amount of contributions considered a distribution and, if so, is it taxable? Suppose the contributions were made with pretax dollars which means of course that taxes haven't been paid on the contributions. In the event the accounts drops below the amount of the contributions, how is the difference treated tax-wise as that part of the contribution has "disappeared".

May this never happen to anyone but it can...

Thank you.
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