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Is there any portion of a distribution that’s tax-free?

April 26, 2017distribution portion tax-free

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Is there any portion of a distribution that’s tax-free?

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Yes, if the distribution includes after–tax contributions or Roth after–tax contributions. Non–Roth after–tax contributions can be distributed tax–free, but earnings are taxable. Qualified distributions from Roth 401(k) or 403(b) accounts are tax–free. However, the earnings portion of nonqualified Roth distributions is taxable.