I have a inherited Ira that I obtained approx 6 years ago at Vanguard . Last week I exchanged one fund for another this account. My question is was that a capital gain event.? I did not take a distribution just swap one fund for another like I would in any other ira account. In hindsight I should have inquired before making the move but it looks like I maybe responsible for the capital gains. Any info is appreciated
Transactions within the IRA [regular or Inherited] don't have tax implications. RMDs are required from Inherited IRAs [except for 2020] for nonspouse beneficiaries and the stretch rules were also changed recently.
Capital gains, interest, dividends....these have absolutely no tax consequences to the IRA owner. The only thing that matters for IRA owners or inheritors, is withdrawals (note: unrelated business taxable income is an exception to this, but for most, this is EXTREMELY rare.).
Assuming the Traditional IRA has no after-tax basis (past years non-deductible contributions) every dollar of withdrawal must be included that year as ordinary income.