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geebee1932--
Level 1
June 27, 2020
Question

Is an early distribution from an IRA that I have to pay taxes and a penalty on considered selling mutual funds?

  • June 27, 2020
  • 2 replies
  • 7 views
No text available

2 replies

T
Alumni - Champ
TomD8Alumni - Champ
Alumni - Champ
June 27, 2020

No.

**Answers are correct to the best of my ability but do not constitute tax or legal advice.
    B
    BillM223
    Level 15
    June 27, 2020

    IRA distributions are taxed as ordinary income (and the penalty is extra).

     

    I do not know what you mean by "considered selling mutual funds", but I suspect the answer is "no". Your question sounds to me that you wondering if an IRA distribution is the same as selling after-tax mutual funds, and the answer would be no.

     

    This is true even if the entire IRA distribution distribution used to be invested in mutual funds within the IRA.

     

    Where do you see this reference to "mutual funds"? Is it something you see in TurboTax?

    **Say "Thanks" by clicking the thumb icon in a post. **Mark the post that answers your question by clicking on "Mark as Best Answer"
      fanfare
      fanfare
      Level 15
      June 28, 2020

      A distribution is a distribution and that's that.

      Unless it is an RMD.

      Unless it would have been an RMD but for the CARES act.

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