Message Font: Serif | Sans-Serif
 
UnThreaded | Threaded | Whole Thread (12) | Ignore Thread Prev | Next
Author: MarinBMWZ4 Big red star, 1000 posts Old School Fool CAPS All Star Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: of 121585  
Subject: Re: Reinvesting Roth liquidated for a tax loss Date: 12/8/2008 3:54 PM
Post New | Post Reply | Reply Later | Create Poll Report this Post | Recommend it!
Recommendations: 0
If I had an AGI of $100,000, after the 2% rule, I could a claim $1098.55 loss. If I had a 25% tax rate, this would convert into about $823.92 into my pocket.

Aw, you were doing so well and choked at the end.

Working from my simplified Schedule A entry of $3100, you get tax benefit from $1,100. At a 25% tax rate that's $275 added to your pocket.

I don't know how much you were planning on contributing for 2008, but if it was more than $4,855 ($10,000 - $5,145) you have given up that contribution and all its tax-free earnings in exchange for $275 in your pocket. Don't spend it all in one place.

Phil
----------
2 things crop up from my end:

The $275 in the pocket is actually, as far as I can tell, a $275 REDUCTION in tax liability, not necessarially cash in the pocket.

If you want cash in the pocket, just take it from the funds in the ROTh accounts and quite fooling around with this do over. The potential long term, compounded, tax free gains , to me, would immediatly preclude doing anything at all with the ROTHs. Of course, if you are not satified with the performance, put it in something else.

MZ4
Post New | Post Reply | Reply Later | Create Poll Report this Post | Recommend it!
Print the post  
UnThreaded | Threaded | Whole Thread (12) | Ignore Thread Prev | Next

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.
Foolanthropy 2014!
By working with young, first-time moms, Nurse-Family Partnership is able to truly change lives – for generations to come.
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.
Post of the Day:
Macro Economics

Looking at Currency Ratios
What was Your Dumbest Investment?
Share it with us -- and learn from others' stories of flubs.
Community Home
Speak Your Mind, Start Your Blog, Rate Your Stocks

Community Team Fools - who are those TMF's?
Contact Us
Contact Customer Service and other Fool departments here.
Work for Fools?
Winner of the Washingtonian great places to work, and "#1 Media Company to Work For" (BusinessInsider 2011)! 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