Is there ferdral tax / income Tax is my Pension money taxed I want to make sure my $1.1MM IRA will keep me at the same standard of living i am at now.
2007-10-11 06:46:01 · 7 answers · asked by james b 2 in Business & Finance ➔ Taxes ➔ United States
Traditional IRA, so if i take out $50K per year what is the Tax rate. FED/State
2007-10-11 06:58:58 · update #1
I assume you are not drawing Social Security benefits.
Your pension money is generally taxed on your federal return. Add your IRA distribution to this, and you will be taxed on the total. Only income taxes will be assessed, there will be no Social Security or Medicare taxes to pay.
The percentage rate depends on your total taxable income, and ranges from 10% to 35%. For a single taxpayer, the 10% bracket ends at $7,850, the 15% bracket at $31,850, the 25% at $77,100.
Here is a link to the federal tax bracket tables:
http://www.irs.gov/formspubs/article/0,,id=164272,00.html
How you take your IRA distributions can greatly affect your taxes as well as your future income. Have your financial institution or a tax advisor draw up some scenarios for you, taking into account your RMD as well as the taxes on your SS payments when you start to receive them.
2007-10-11 07:32:23 · answer #1 · answered by ninasgramma 7 · 0⤊ 0⤋
Yes, unless it is a Roth.
Federal: Same rate as your other income.
State: Florida used to tax assets rather than income. If Florida still does not have a personal income tax, then 0%; otherwise, I do not know.
Research the Florida tax on intangible assets. If it is still around and you retire there, you could be looking a big tax bill even if you do not take $ out of your IRA.
No, if it is a Roth.
2007-10-11 15:03:03 · answer #2 · answered by StephenWeinstein 7 · 0⤊ 0⤋
If it's a traditional IRA, withdrawals will be taxed as ordinary income. The rate will depend on how much you withdraw that year, what other income you have if any, and your personal circumstances.
2007-10-11 13:55:40 · answer #3 · answered by Judy 7 · 1⤊ 0⤋
That depends on which IRA you have and the terms. Is it a Roth or a normal IRA? Is it tax-deffered or were you taxed when you put the money in?
Contact who you took the IRA out with and give them your information, they may be able to help you out more on this.
2007-10-11 13:54:49 · answer #4 · answered by Toledo Engineer 6 · 0⤊ 0⤋
Florida does not have a state income tax. The intangible tax on assets that someone else mentioned above never applied to retirement assets. Either way, it was repealed in 2006.
2007-10-11 23:30:37 · answer #5 · answered by JaretR72 2 · 0⤊ 0⤋
you're definitely taxed - at the rate of whatever bracket you wind up in at the end of the year with all other sources of income added to your withdrawals and you will need to make quarterly federal estimated payments to avoid penalties
2007-10-11 15:25:14 · answer #6 · answered by Anonymous · 0⤊ 0⤋
Withdrawals will be taxed as ordinary income
2007-10-11 13:50:03 · answer #7 · answered by Anonymous · 1⤊ 0⤋