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Here is a question that I just read about and would like to understand better.

I am a participant in a 401(k) plan. Part of what I invest in is stock of my employer. For this discussion we will use the following:

I have 100 shares of stock.
I paid $5.00 per share for those 100 shares.
The value per share at the time of my retirement is $25.00

Now for the questions

If I roll the 401(k) money over into an IRA will all of value of the 401(k) be taxed as ordinary income?

If I take the stock out as stock when I retire and do not put it into an IRA what would my basis then be in the stock and how much would I pay taxes on? Would it be taxed at ordinary or Capital gains (short or long term as appropriate) rates?

If I leave it in the 401(k) and the value goes up to $45.00 and I die how is it taxed (ordinary, long term, etc.)?

Hope I stated this clearly. Thanks for all your help

Zeb and Hildegarde
(Out in the country)
(Right next door to the Ziffles)
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