What a taxable index-fund account is actually worth after expense-ratio drag and after Alabama takes its share of the gain — which, in most states, is not at the federal preferential rate.
There is no state equivalent of the federal preferential rate here — a long-term gain is charged at Alabama's normal income brackets, exactly like wages. This is the common case, and it surprises people who assume the federal 15% carries over. Taxed as ordinary income at the 2%/4%/5% schedule, with no preferential rate, no holding-period benefit and no exclusion percentage. The Form 40 instructions place 'Gains from the sale or exchange' of property squarely on the list of income you MUST report, and Alabama's tax is computed from a single rate schedule with no capital-gains line, schedule or subtraction. Because Alabama's top rate is only 5%, a long-term gain is taxed lightly here in absolute terms even though it receives no preference. ONE NARROW AND RECENT CARVE-OUT, WORTH RECORDING BECAUSE IT IS EASY TO MISS AND IS GENUINELY UNUSUAL: beginning January 1, 2025, any net capital gain on the exchange of PRECIOUS METAL BULLION is exempt. Alabama defines that as coins, bars or rounds containing primarily refined gold, silver, platinum or palladium that are marked and valued primarily by weight, purity and content. It does not extend to securities, real estate or collectibles generally.
What your state actually takes from a 401(k) withdrawal, a pension, and Social Security — in dollars, not a yes/no list.
2026 limits, employer match, the 60-63 super catch-up, and whether the Roth catch-up mandate applies to you.
When your RMDs start under SECURE 2.0, how much this year's is, and what missing it costs.
A required minimum distribution is ordinary income, taxed at your top bracket and often pushing you into the next one. Here is the federal tax on RMDs from $20,000 to $75,000 at different income levels, why the default 10% withholding usually leaves a bill, how to avoid an underpayment penalty, and the three side effects that make the real rate higher than the bracket.
The required minimum distribution on every common balance at every age from 73 to 95, worked from the IRS table, plus what happens to the account over twenty years of withdrawals at 0%, 5% and 7% returns. The short version: the share you must take rises every year, and at good returns the dollar amount keeps rising with it.
What moving actually saves, on your own income mix rather than a headline rate — and how to establish domicile so the state you left cannot follow you.
Which account to draw first, priced. The three cliffs a withdrawal can cross without warning, the conversion window almost nobody uses, and why the order is the last big decision you can still change.