Are there any penalties selling your mutual funds in your IRA account? (but not withdrawing)?

There are no penalties for selling your mutual funds if you do not withdraw, which is called exchange transaction. You are transferring funds from one type of mutual fund to another type. If you withdraw your money before you are 62-1/2 without IRS specified reasons (buying a first home, etc.) then you will pay a 10% penalty in addition to paying income tax on the withdrawn amount.

If you are feeling a little nervous about the current market situation, then move some of your stock funds to either bond funds or money market funds,

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You will need to look at the individual fund and your IRA management company. This is a bad time to sell, I'd sit on it until the market firms up.