{"id":722,"date":"2016-10-07T00:24:11","date_gmt":"2016-10-07T00:24:11","guid":{"rendered":"http:\/\/onlyfordentists.com\/blog\/?p=722"},"modified":"2016-10-07T00:24:11","modified_gmt":"2016-10-07T00:24:11","slug":"what-you-need-to-know-about-iras-and-taxes","status":"publish","type":"post","link":"https:\/\/onlyfordentists.com\/blog\/2016\/10\/what-you-need-to-know-about-iras-and-taxes\/","title":{"rendered":"What You Need to Know about IRAs and Taxes"},"content":{"rendered":"

\"Nest<\/a>Tax deferral is a key benefit of investing in a traditional individual retirement account (IRA). But the tax law doesn\u2019t allow indefinite tax deferral. Starting at age 70\u00bd, IRA owners must withdraw a minimum amount \u2014 called a required minimum distribution, or RMD \u2014 every year. All funds withdrawn from a traditional IRA are taxed as ordinary income except for nondeductible contributions, which aren\u2019t taxed again.<\/p>\n

A beneficiary who inherits a traditional IRA doesn\u2019t receive a pass on income taxes. If you inherit an IRA, be cautious about simply liquidating the account, since the tax bite could be quite large. Instead, talk with us about your distribution options.<\/p>\n

 <\/p>\n

As a Surviving Spouse . . .<\/strong><\/p>\n

You can leave the account as is and designate yourself as the account owner<\/em>, assuming you are the sole designated beneficiary of your spouse\u2019s IRA. Or you can roll the funds over into your own traditional IRA. Either way, you won\u2019t have<\/em> to take any money out until after you reach age 70\u00bd. Then, you\u2019ll have to start taking RMDs. If you want to, you can allow the rest of your IRA to continue growing tax deferred.<\/p>\n

A surviving spouse can also choose to be treated as the IRA beneficiary<\/em>. This might be the better choice if you\u2019ll need to take money from the IRA before you turn 59\u00bd, since withdrawals by IRA beneficiaries escape the 10% tax penalty on early withdrawals. What about RMDs? If you go the beneficiary route, you generally won\u2019t have to start taking them until the year your spouse would have reached 70\u00bd.<\/p>\n

 <\/p>\n

As a Nonspouse Designated Beneficiary . . .<\/strong><\/p>\n

You can also stretch out withdrawals \u2014 and the related income taxes \u2014 by setting up an inherited IRA. The deadline for taking your first RMD is December 31 of the year after the year the account owner died. You may make additional withdrawals from the IRA at any time.<\/p>\n

Somewhat different rules may apply if you receive an IRA that has passed through an estate instead of directly to you as the account\u2019s designated beneficiary. To get the most from your IRA inheritance, you\u2019ll want to carefully evaluate your options.<\/p>\n

Give us a call today, so we can help you determine the right course of action for you.<\/p>\n","protected":false},"excerpt":{"rendered":"

Tax deferral is a key benefit of investing in a traditional individual retirement account (IRA). But the tax law doesn\u2019t allow indefinite tax deferral. Starting at age 70\u00bd, IRA owners must withdraw a minimum amount \u2014 called a required minimum distribution, or RMD \u2014 every year. All funds withdrawn from a traditional IRA are taxed […]<\/p>\n","protected":false},"author":2,"featured_media":0,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"_genesis_hide_title":false,"_genesis_hide_breadcrumbs":false,"_genesis_hide_singular_image":false,"_genesis_hide_footer_widgets":false,"_genesis_custom_body_class":"","_genesis_custom_post_class":"","_genesis_layout":"","footnotes":""},"categories":[1],"tags":[],"class_list":{"0":"post-722","1":"post","2":"type-post","3":"status-publish","4":"format-standard","6":"category-uncategorized","7":"entry","8":"has-post-thumbnail"},"_links":{"self":[{"href":"https:\/\/onlyfordentists.com\/blog\/wp-json\/wp\/v2\/posts\/722","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/onlyfordentists.com\/blog\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/onlyfordentists.com\/blog\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/onlyfordentists.com\/blog\/wp-json\/wp\/v2\/users\/2"}],"replies":[{"embeddable":true,"href":"https:\/\/onlyfordentists.com\/blog\/wp-json\/wp\/v2\/comments?post=722"}],"version-history":[{"count":1,"href":"https:\/\/onlyfordentists.com\/blog\/wp-json\/wp\/v2\/posts\/722\/revisions"}],"predecessor-version":[{"id":724,"href":"https:\/\/onlyfordentists.com\/blog\/wp-json\/wp\/v2\/posts\/722\/revisions\/724"}],"wp:attachment":[{"href":"https:\/\/onlyfordentists.com\/blog\/wp-json\/wp\/v2\/media?parent=722"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/onlyfordentists.com\/blog\/wp-json\/wp\/v2\/categories?post=722"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/onlyfordentists.com\/blog\/wp-json\/wp\/v2\/tags?post=722"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}