How much in taxes will I be paying if I withdraw my IRA after 2 years?
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I am trying to figure out approximate amount I will be paying in taxes if I go with traditional IRA. Here are some more details: I live in New Jersey. For 2008 I am paying 16.78% in taxes as I am filing my taxes jointly with my wife. We both made $145,000 taxable income in 2008. My question is say if I put $5000 in traditional IRA for 2008 today and say in 2011 if for some reason I withdraw the amount apart from 10% withdrawal penalty how much will I be paying in taxes assuming that taxes are the same in 2011. Thanks in Advance.
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Answer:
You would pay the same amount, by your assumptions (that the tax rate would be the same), unless that amount puts you up to a higher tax bracket. Plus, if applicable, the 10% tax penalty, and state taxes.
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