Message Font: Serif | Sans-Serif
 
No. of Recommendations: 0
[[I have contributed a total of $6000 to the traditional IRA, of which only $530 was deducted from
my taxes. That leaves $5470 of IRA contributions that were non-deductible contributions. When I
converted my trad. IRA to a Roth IRA on 3/17/98, the value of the IRA was $4764.]]

Owch. I hope that you investing future shows more promise.

[[ Question # 1: Does the IRS use the value of the IRA on the date it was converted for tax purposes
or does it use some other day? ]]

Conversion date.

[[ Question # 2: Since I have actually lost money in my IRA, does this mean I won't have to pay any
taxes on this conversion? (Again, I've already paid taxes on $5470 worth of contributions, and the
IRA is worth only $4764).]]

Yup. Since your basis in the IRA is greater than the value of the IRA, none of your conversion amount will be taxable.

TMF Taxes
Roy
Print the post  

Announcements

Disclaimer:
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.
Advertisement