Hello,
Is there any way I can use a distribution from an IRA and not have it income taxed? I'm not talking about the "10k first time home buyer with no penalty." I am 60 years old. What if I rented out part of the house, and lived in the other? Any other possible way to shelter the down payment on a house for this real estate investment?
Just looking for any way possible to not pay the tax on the distribution. Thanks for input.
Jack
I'm pretty sure tht if you donate the entire distribution to charity , you won't end up paying any tax on it.....
Disclaimer: I'm not a tax pro.
Other than the charitable donation that MikeJones mentioned, I'm not aware of any way to get a tax-free distribution from an IRA account. The deal of non-Roth IRAs is that you get the tax break up front when you contribute the money but have to pay taxes at distribution time. You don't get a tax break at both ends of the transaction.
If you have post-tax money in a traditional IRA, then a portion of the distribution will not be taxed, but it won't be fully tax-free (unless the IRA has done really poorly and the value is less than the post-tax money you contributed. Note that this is across all IRAs you own, so it would only rarely come up.)
I suppose that technically you could do a Roth conversion and then get tax-free distributions, but since you would pay taxes on the conversion amount it wouldn't really help.
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