Message Font: Serif | Sans-Serif
No. of Recommendations: 4
This year I received $10,000 out of my traditional IRA as part of a first time home purchase. I did receive deductions when I contributed to my traditional IRA. I realize that I will not have to pay the 10% penalty, but have read several times that I will have to pay normal taxes on my distributions. I'm not exactly sure what this last part means. Does this mean I have to recognize the capital gains on the distribution or does the full distribution amount go into income for next years return? Any help is appreciated.

You'll get a 1099R next year and you'll report the $10,000 distribution as income on line 15 of the 1040 with all of it taxable at ordinary income rates.
Print the post  


In accordance with IRS Circular 230, you cannot use the contents of any post on The Motley Fool's message boards to avoid tax-related penalties under the Internal Revenue Code or applicable state or local tax law provisions.
What was Your Dumbest Investment?
Share it with us -- and learn from others' stories of flubs.
When Life Gives You Lemons
We all have had hardships and made poor decisions. The important thing is how we respond and grow. Read the story of a Fool who started from nothing, and looks to gain everything.
Contact Us
Contact Customer Service and other Fool departments here.
Work for Fools?
Winner of the Washingtonian great places to work, and Glassdoor #1 Company to Work For 2015! Have access to all of TMF's online and email products for FREE, and be paid for your contributions to TMF! Click the link and start your Fool career.