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I'm trying to gain a better understanding for potential loss situations within 401k investment funds.

Let's say that over a period of years $100,000 are directed into a 401k and then invested into equities that ultimately result in a net loss (when the funds are withdrawn, the total value is $1,000 for example).

Is there a loss that can be claimed from a tax standpoint? Something like a capital loss? $100,000 were "earned" but the earner only realized $1,000 for a "loss" of $99,000.

My very simple understanding of this is no and the $99,000 would be a total loss and there are no tax benefits to soften the blow. It would seem to me that since the directed funds were never technically received by the investor until they were withdrawn, there is no loss to claim? Is this true?
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