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Author: TMFPMarti Big funky green star, 20000 posts Home Fool Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: of 121061  
Subject: Re: Pls Help Me get Off To A Good Start Date: 11/16/2011 4:17 PM
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Not a lot to offer from a tax perspective at this point.

Property transfers incident to divorce are normally tax-ignored events, but given that you're dealing with a sizeable chunk of change, make sure your personal tax advisor goes over the property settlement before your divorce lawyer goes to court with it. Divorce lawyers are notorious for knowing bupkes about tax law but pretending they're experts. Also make sure your tax person reviews the entire stipulation to see if there's anything lurking in there down the road.

Our general advice is to keep investments that will generate ordinary income in retirement acounts and those that will generate long-term cap gains in your taxable account. You seem already to have a handle on the types of things you can't do in an IRA. One caution about wash sales. The universe of potential "replacement" shares includes all shares you own in all accounts, including retirement accounts. This is unlike specific identification, which includes only the account you're selling from. Do not sell for a loss in a taxable account and buy to create a wash sale in a retirement account. You will never get to recognize that loss.

Likewise foreign taxes. Foreign taxes paid from a retirement account yield no tax benefit since the retirement account doesn't pay income tax.

Phil
Rule Your Retirement Home Fool
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