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Greetings, Unleadedfool, and welcome. You asked:

<<My question is: Can I convey my $2,000 contribution to the IRA in the form of already-owned stock? Would it be considered a sale (complete with capital gains) and a subsequent purchase or would my basis in the stock be the purchase price I paid before I set up the IRA?>>

GW is correct. You may not transfer shares from a taxable account into an IRA. Shares may be transferred only from another IRA or a qualified retirement plan. Therefore, the best you can do is to sell some, pay taxes on any gain, and deposit $2K in a nondeductible traditional IRA. The latter is the only IRA for which you qualify based on your income.

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