Quote:
Originally Posted by pauld315
I will be retiring in a few years and I am just wondering how income is defined and measured at that point. I saw a demographic that the average household income in TV was 93K. My retirement plan is made up of 3 major components. They are my pension, Social Security and a 401K. Would my income be the total of the pension, social security and whatever I decide to take out of my 401 K per year ? Or, would it also include any interest my 401K earned that particular year when they are measuring household income ? I know I still wouldn't have to pay tax on the interest until withdrawal so I know from an IRS poit of view it doesn't count as income until distributed, but when they put together these demographics, do they include that interest ?
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Anything the IRS website attempts to explain is complicated. But scroll through this page and see if you can find answers to some of your income questions. Remember, the latest information on the IRS website is for 2009. In many discussions on these IRS pages; if the information for 2010 is known, it is shown.
http://www.irs.gov/publications/p554/ch02.html