A:



Any taxable amount of the distribution will represent ordinary income for the year that the distribution occurs and will be subject to income tax at your regular/ordinary income tax rate.



If the amount is significant, it could put your income in a higher tax bracket.



Visit the IRS website for 2007 Federal Tax Rate Schedules.

For more on required minimum distributions (RMDs), see Avoiding RMD Pitfalls and Strategic Ways To Distribute Your RMD.



This question was answered by Denise Appleby
(Contact Denise)



RELATED FAQS

  1. Are gross sales and taxable gross sales the same thing?

    Learn the difference between gross sales and taxable gross sales and how these terms relate to the profit and tax liability ...
  2. What is the difference between a regressive tax and proportional tax?

    Learn about the differences between regressive, progressive and proportional taxes and how they each affect everyday finances ...
  3. Are progressive taxes ever more unfair that flat taxes?

    Learn more about progressive taxes and flat taxes. Find out why progressive taxes may be unfair for many taxpayers and why ...
  4. Is a progressive tax more fair than a flat tax?

    Find out which is more fair: flat tax or progressive tax. Learn about both sides of the debate and the challenges of defining ...
RELATED TERMS
  1. Current Service Benefit

    The amount of pension benefit accrued by an employee who had ...
  2. Self Invested Personal Pension (SIPP)

    A tax-efficient retirement savings account available in Great ...
  3. Elder Care

    Elder care, sometimes called elderly care, refers to services ...
  4. Deferred Tax Asset

    A deferred tax asset is an asset on a company's balance sheet ...
  5. Eligible Transfer

    An IRS-allowed movement of assets into or out of an individual ...
  6. Leveraged Benefits

    The use – by a business owner or professional practitioner – ...

You May Also Like

Related Articles
  1. Professionals

    Target Date Funds: More Popular, Cheaper ...

  2. Investing

    Why did Larry Page pay himself a salary ...

  3. Professionals

    Are Longevity Annuities in 401(k)s a ...

  4. Stock Analysis

    What Makes LinnCo Different From MLPs?

  5. Stock Analysis

    Why Should Investors Read The Annual ...

Trading Center