by slottman on November 13th, 2006

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Can i spend the interest from a 401k type of account and it will be tax free?

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by Stableboy on November 14th, 2006
The earnings and principal of the account will both be taxed at your then-current tax rate when you retire. The contributions aren't taxed while the account accumulates, and neither are the earnings. The presumption is that when you retire you'll be in a lower tax bracket, so this makes the account "tax-advantaged", not "tax-free".
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Can i spend the interest from a 401k type of account and it will be tax free?

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