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How are stock losses handled in a traditional IRA? If I sell a stock at a loss, can I ever claim the loss on my taxes?

Thanks for your help.

sharc
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No. of Recommendations: 0
How are stock losses handled in a traditional IRA? If I sell a stock at a loss, can I ever claim the loss on my taxes?

Thanks for your help.

==========

gains or losses within your IRA are not recognized for tax purposes.

You only recognize income when you take a distribution from the IRA. The amount of that distribution is generally taxable to you as ordinary income. You do not receive any Longterm capital gain benefit from the sale of your stocks within the IRA.

There may be penalties associated with a premature withdrawal of IRA funds (prior to age 59.5)

There are some other special rules for special situations; if you think you have one that applies to you post and we will try to answer.

pete



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sharc writes:

How are stock losses handled in a traditional IRA? If I sell a stock at a loss, can I ever claim the loss on my taxes?

I reply:

I believe that there is one way to take the loss, though it's strongly reminiscent of cutting off one's nose to spite one's face. If you close your IRA and your distribution is less than your basis (assuming that the IRA is non-deductible), then your losses are deductible on Schedule A as a miscellaneous itemized deductible, subject to the 2% of AGI floor. --Bob
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