Message Font: Serif | Sans-Serif
No. of Recommendations: 0
Hi Rosesmeller,
To quote:
"Otherwise your taxes on the distribution are based on the value when the distribution is made - there's no difference whether you get shares or money. If you keep the shares, your basis for a future sale will be the value when they were distributed - the same amount you pay taxes on now."

I don't believe the above statement is correct. If one takes an "in kind" distribution of the stock from a 401k, the tax is on the cost basis of the stock, not the value at time of distribution. The NUA (net unrealized appreciation) is taxed at the time the stock is subsequently sold at the appropriate capital gain tax rate.

Respectfully, gopete
Print the post  


In accordance with IRS Circular 230, you cannot use the contents of any post on The Motley Fool's message boards to avoid tax-related penalties under the Internal Revenue Code or applicable state or local tax law provisions.
When Life Gives You Lemons
We all have had hardships and made poor decisions. The important thing is how we respond and grow. Read the story of a Fool who started from nothing, and looks to gain everything.
Contact Us
Contact Customer Service and other Fool departments here.
Work for Fools?
Winner of the Washingtonian great places to work, and Glassdoor #1 Company to Work For 2015! Have access to all of TMF's online and email products for FREE, and be paid for your contributions to TMF! Click the link and start your Fool career.