I did a search on Cd’s (the thing you put money in), but it said I must have more than 4 characters. I am sure I saw this covered before.
If a person puts money in a Cd, does one pay taxes on the principle when it is eventually withdrawn?
PS Why am I not allowed to edit my post? I spelled Cds wrong.
Editing is not allowed here primarily (I believe) because it would allow persons having made unacceptable statements in a debate to withdraw them in such a way as to make their opponents look stupid or unreasonable (“Why are you asking me to defend that position; I never said any such thing!”), or possibly to remove the ‘evidence’ of insulting statements after they had done their damage, but before they were spotted by a moderator.
Oooh. OK:) That makes sense.
And to answer your question, no, you do not have to pay any additional taxes on your principle. It’s just like a savings account, only there are penalties (from the bank) for withdrawing your money early.
Like Telemark said, you don’t pay taxes on the principle, but you do, of course, pay taxes on the interest you’ve earned, just like a savings account or interest-bearing checking account.
For Google searching, look for “certificates of deposit.”
Thank you very much. You answered my question. I will check out Google.