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I am 67 years old. Like most people, I have significant capital losses this year. Can I take out money from my traditional IRA to offset the capital losses?

Yes and no. There is no direct offset of IRA distributions against capital losses.

IRA distributions are reported on line 15 of your 1040. Capital losses in taxable accounts are reported on Schedule D. If the bottom line of Schedule D is a loss, up to $3,000 of the loss is carried to line 13 of the 1040, where it would offset other income, including that shown on line 15.

If I do, does this mean I have to take out money next year or can I wait until I am 70½?

From ages 59 1/2 to 70 1/2 you are in what I call the golden years of IRA distributions (unless you entered a SEPP before age 59 1/2, which is moot in your case). During these golden years you are free to take as much or as little as you like in IRA distributions without penalty.

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