Boston North SHore taxes can throw some retirees a curveball if they’re not knowledgeable or prepared. Like most Americans, you’ve worked hard all your life and saved or invested for years to be able to enjoy retirement. What you don’t know about taxes could make retirement a little less enjoyable.

Boston North Shore Taxes – What to Know

IRA or 401(k) accounts. If you withdraw money from a traditional IRA or 401(k) you will be taxed as if it was ordinary income. Withdrawals of earnings from a Roth IRA, however, are tax-free if you’re at least 59 1/2 and the account has been open for a minimum of 5 years. Remember, contributions to your Roth IRA can be withdrawn at any time tax-free since the contributions were made with after-tax money.

Regarding taxable accounts, the tax liability depends on the kinds of investments you own and how long you’ve had them.

Savings accounts and CDs. Interest is taxed as ordinary income.

Stocks, mutual funds and other investments. You will pay no tax on the capital gains from the sale of stocks or mutual funds if you’re in the 10% or 15% tax bracket — provided you’ve owned those investments for a year or longer. People in higher tax brackets will pay 15% on long-term capital gains.

Government pensions or private retirement pensions. These retirement pensions are usually taxable at your ordinary income rate.

Social Security benefits. Surprising to many retirees is that a portion of your Social Security benefits may be taxable. The tax liability depends largely on your other sources of income and their amounts. Up to 85% of your Social Security benefits could be taxed.

The impact of state and local taxes. If you move out of state, you could be facing a higher tax bill. While seven states have no income tax, they compensate by having higher real estate taxes or retail sales taxes. Still, many states with income taxes make retirement attractive by offering retirees generous breaks that may help to lessen or erase your tax bill.

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