I know RMDs are taxed as ordinary income. But are Ordinary Dividends, Qualified Dividends, Capital Gain Distributions and Interest Income that are generated for the IRA during the year also taxed? And how are they taxed? What rate(s)?
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All earnings (dividends, capital gains, interest...) made within the IRA are tax-deferred and are not reported to the IRS.
Only distributions (including RMDs) are taxed at the ordinary income rates.
Any Income earned within an IRA, no matter from which soure, is not taxed until it is withdrawn either as an RMD or as a distribution at which time it is taxed as ordinary income.
That is one of the advantages and disadvantages of a IRA. It grows tax deferred so you don’t pay any taxes on the dividends and interest etc. while it’s in the IRA account. You only pay the tax when you take it out. But then it all comes out as ordinary income, not as qualified dividends etc. and taxed at your regular tax rate.
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