pensions rollover
Invested $2,000 in a money market retirement account 20 years ago and it never made any money. Last year I cashed out $1,700 and with some other funds purchased $3,000 in I Bonds. Can this be considered a retirement plan? Or would I need to claim the withdrawal as income?
Hoping to retire in 5 years and would like to make some money. Purchased the I Bond based on your recommendation last year.
Thanks
Terry Says
If you cashed out your IRA last year, then you owe taxes on the gains from interest. Your custodian should have sent you a 1099 form to report that interest.
Your I-bond is growing tax-deferred until you cash it in — after holding it at least 5 years to avoid the penalty. At that point you’ll owe ordinary income taxes on all the accrued interest.
