UnThreaded | Threaded | Whole Thread (2) | Ignore Thread Prev Thread | Next Thread
Author: clough123 Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: of 75340  
Subject: c. gain/losses & divi in Roth Date: 1/11/1999 6:59 PM
Post New | Post Reply | Reply Later | Create Poll . Report this Post | Recommend it!
Recommendations: 0
Help again,
1. Is it true that there are no such thing as short or long term capitol gains in a Roth (as long as the procedes stay put)? ie., growth is tax free

2. Are dividends paid into a Roth account, coming from the stocks in that account, considered as 'income'? ie, do they count against your 2,000 contribution for any given year?

3. Do wash sale limitations apply to these accounts?
Print the post Back To Top
Author: TMFPixy Big gold star, 5000 posts Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: 7859 of 75340
Subject: Re: c. gain/losses & divi in Roth Date: 1/16/1999 11:16 AM
Post New | Post Reply | Reply Later | Create Poll . Report this Post | Recommend it!
Recommendations: 0
Clough asks:

<<Help again,
1. Is it true that there are no such thing as short or long term capitol gains in a Roth (as long as the procedes stay put)? ie., growth is tax free>>


Yes, that's true provided all withdrawals meet the test for a qualified distribution. To see what is a qualified distribution, see my explanation of the Roth IRA in the Foolish Retirement Plan Primer available at http://www.fool.com/retirement .

<<2. Are dividends paid into a Roth account, coming from the stocks in that account, considered as 'income'? ie, do they count against your 2,000 contribution for any given year?>>

No, they are not. They are considered tax deferred income, do not count as part of your annual contribution, and (as long as you meet the rules for a qualified distribution) they will ultimately be paid out tax-free to you.

<<3. Do wash sale limitations apply to these accounts?>>

Wash sale limits apply only if you sell shares at a loss in a taxable account, claim that loss on your tax return, and buy those same shares within the 30 calendar days before or after the sale. If you don't claim a loss, you have no wash sale. If you claim the loss, the IRS would probably argue that you purchased identical replacement shares within the Roth in violation of the wash sale rules.

Regards….Pixy


Post New | Post Reply | Reply Later | Create Poll . Report this Post | Recommend it!
Print the post Back To Top
UnThreaded | Threaded | Whole Thread (2) | Ignore Thread Prev Thread | Next Thread
Advertisement