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What are the tax ramifications of owning taxable bond funds in an IRA after age 70 1/2 when there are Required Minimum Distributions? Would this reduce the tax bite on the distribution? If so, why? - Because the expected returns are less?

The tax ramifications for owning a taxable bond fund in a Traditional IRA, no matter what your age, are the same as any other investment, assuming your investments are not prohibited transactions - taxes are deferred. Taxes for a Traditional IRA are based on the distributions taken, not the investments used to generate those returns.

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