Common Sense Evaluation

This handy chart tells you how basic investment accounts are taxed.

Investing isn’t nearly as intimidating as it seems. But all of the tax rules for different investing accounts can be overwhelming. The folks at Bankrate break down the basics in one simple chart.

Some investment accounts are taxable, and others, like an IRA, are tax-advantaged. You’ll pay your taxes either way, but tax-advantaged simply means you can either deduct your contributions from your taxes now or withdraw your money tax-free later.

But it doesn’t mean you won’t have to pay taxes at all. We’ve told you the details about how taxes work with investments before. But if you’re looking for a quick reference guide, Bankrate’s chart tells you what the rules are and how you’ll be taxed.

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