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New kid in town
Join Date: Nov 2001
Posts: 2,288
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IRA question
Got divorced and am up to my eye-balls in debt. How can I cash out an IRA with the smallest tax hit? Anyone BTDT?
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I wish I still had 9111113443... |
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07-31-2007, 01:56 PM
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Registered
Join Date: Jan 2003
Posts: 239
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Turn 59 and a half, use it for a down payment on your FIRST house, pay for school, otherwise 10% penalty and becomes ordinary income the year you withdraw.
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07 997 cab sold 95 993 cab sold 87 911 cab sold |
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07-31-2007, 02:17 PM
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Registered
Join Date: Mar 2004
Location: Summerville, SC
Posts: 2,057
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What kind of an IRA? If it is a Roth, you can take out any contributions you made -- no taxes, no penalties.
I also believe if you roll a traditional IRA into a Roth, after a period of time -- I think it's 5 years -- you can pull out what you contributed; but on roll-overs and withdrawals, it's best you talk with an accountant. Generally advise: It is probably better to not pull anything out of the IRA and just try to work harder to pay down the debt. The tax-free compounded growth available in the IRA is something you don't want to lose. Once the money is out, it is not like you can just deposit it back later. |
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07-31-2007, 02:35 PM
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New kid in town
Join Date: Nov 2001
Posts: 2,288
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Not answers I was hoping for, but good advice none the less. I was looking more for 'loop holes' that might be available. Maybe move the $$'s to my cat, or something like that...
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I wish I still had 9111113443... |
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07-31-2007, 06:10 PM
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