A:

It depends. You are eligible to write off the losses only if the balance for both of your Roth IRAs (combined) is less than your aggregate contributions and conversions to both Roth IRAs, and you distribute the entire balance of both Roth IRAs.

The loss is claimed on your Form 1040 - Schedule A as an itemized deduction. However, it is subject to the 2% adjusted gross income limit that applies to certain miscellaneous itemized deductions.

See Deducting Losses On Your IRA Investments for more on this topic

Question answered by Denise Appleby, CISP, CRC, CRPS, CRSP, APA

Hot Definitions
  1. Operating Ratio

    A ratio that shows the efficiency of a company's management by comparing operating expense to net sales. Calculated as:
  2. Expense Ratio

    A measure of what it costs an investment company to operate a mutual fund. An expense ratio is determined through an annual ...
  3. Pro Forma

    A Latin term meaning "for the sake of form". In the investing world, it describes a method of calculating financial results ...
  4. Trumpcare

    The American Health Care Act, also known as Trumpcare and Ryancare, is the Republican proposal to replace Obamacare.
  5. Free Carrier - FCA

    A trade term requiring the seller to deliver goods to a named airport, terminal, or other place where the carrier operates. ...
  6. Portable Alpha

    A strategy in which portfolio managers separate alpha from beta by investing in securities that differ from the market index ...
Trading Center