Quote:
Originally Posted by Hawkwind
He would only have to pay taxes in the following years on the interest he receives from his investments. How if he puts the money in coffee cans he pays no taxes.
It would be a hard call as to where to put that much money but I bet there are thousands of hungry money managers wanting a piece of that action.
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Is this correct Hawk? I took out a small (10,000) IRA a few years ago. The money I used to purchase this IRA was from savings I had accumulated from paydays over a few years. Keep in mind, I had already paid taxes on these earnings. So when I recently went to cash in this IRA, I was told that I had to pay 20% tax on the accumulated roughly 13,000 that it was currently worth before withdrawing it. I asked the girl about it explaining that I've already paid taxes on the 10,000 and shouldn't I be taxed only on the roughly three thousand. The best explanantion I could gather from her was "you haven't been paying taxes on this over the past 5 or so years". After a few minutes of discussion, I knew it was useless to pursue because that's the point she kept coming back to. I'll eventually find out when I have my taxes done for "09, but I've yet to find someone who can explain to me why I should be taxed on the 13,000 instead of the accumulated interest of 3,000 in order to withdraw this money.
