Hudson, NH Resident Plans for the Future
Retirement income is not immune to taxes. Taxes on required minimum distributions, including traditional IRAs and 401(k)s, are taxed on their gains and their pre-tax deductible contributions. However, because retirement is likely lower than when the individual was working this is typically taxed at a lower rate. The tax rate applied to this income is determined by the income of the recipient when the money is taken out. For the most recent tax year, this tax rate was capped at 37%.