No. of Recommendations: 0
WellHopper wrote-
<Does one have to differentiate between short & long term capital gains within a traditional IRA
since they are taxed at the prevailing rate at withdrawal? What about a Roth IRA?>

The short answer is NO, all $$ in a Traditional IRA grows unencumbered by capital gains taxes of any kind and is taxed upon distribution as *ordinary income*. If you go back on this board a few days you'll see a number of postings on this subject. The gist of the discussion is that a non-deductible IRA's distributions (taxed at 15%,28%,etc.) *could* result in higher taxes than income from a taxable account composed of stocks held for *long* periods of time (long term cap gains rates are 10%[15% bracket] or 20%[28% bracket or higher] with extra-long term 8% and 18% rates on the way beyond the millimium!)

WRT your second question, Retirement money (post 59 1/2, etc.) comes out of a Roth *completely* tax free (as far as the IRS is concerned, check your own state's code, your mileage may vary), which obviously is lower than 18% OR even 8%. ;)

Print the post  


The Retirement Investing Board
This is the board for all discussions related to Investing for and during retirement. To keep the board relevant and Foolish to everyone, please avoid making any posts pertaining to political partisanship. Fool on and Retire on!
Live Video Event Monday!
The GP team is hosting a live video event on Monday at 4 p.m. ET. Don't worry if you can't make it — we'll have a replay and a transcript. Click for more!
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.