Is it true that all withdrawals for a year from an IRA are considered regular income when completing that years taxes? I am 67 years old so they would not be considered early withdrawals.
Example, if for all of 2021 I withdraw a total of $50,000 from my IRA and have no other income to claim (SS, Pension, Dividends, Interest, Gains, etc.) then after standard deductions of $14,250 my taxable income (line 15) would be $35,750 and therefore would be taxed at 12%?
Depending on what type of IRA you have, (Roth or Traditional IRA)-
Withdrawals from a Roth IRA are tax free as long as you are 59 ½ or older and your account is at least five years old.
Withdrawals from traditional IRAs are taxed as regular income, based on your tax bracket for the year in which you make the withdrawal.
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Thankyou Ray, that's what I was looking for. I was aware of the Roth being tax free and that is actually why I am asking the question regarding a Traditional IRA withdrawal. My other regular income is going to be relatively low this year and thus thought it was an ideal opportunity to withdraw a significant amount from my Traditional IRAIRA and transfer most of it to my Roth with a minimal tax impact, as opposed to doing it in 2022 when my taxes will probably be in the 22% bracket due to a pension and SS starting that year.