I have money invested in an IRA that was from a accident settlement. It wasn't taxable then. Why is it taxable when I make a withdrawal? It's not related to employment

[Coleen3 · Accepted solution]

Money contributed into a Traditional IRA is deductible when contributed and taxable when distributed. Money contributed into a Roth are not deductible but are also non-taxible if you meet certain requirements. You can always take out your own contribution, tax-free from a Roth.