I have two Roth IRAs, one of which has a balance that is much less than the total contributions I have made to the account. Can I write off the losses for that account?

By Denise Appleby AAA
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



RELATED FAQS

  1. What are the 403(b) contribution limits?

    Determine whether 403(b) contributions meet federal guidelines. Contribution limits to this retirement plan are determined ...
  2. Can I roll over a 403b plan?

    Learn whether distributions from a 403(b) plan can be rolled over, where they can be rolled over to and what the income tax ...
  3. What is the difference between a 408 (k) plan and a 401 (k) plan?

    Learn key differences between 401(k) and 408(k) plans. Employers provide different options to help employees save for retirement, ...
  4. Is a 408 (k) the same as a Simplified Employee Pension (SEP)?

    Find out the differences and the similarities between a 408(k) retirement plan and a simplified employee pension (SEP), and ...
RELATED TERMS
  1. Elder Care

    Elder care, sometimes called elderly care, refers to services ...
  2. Gold IRA

    Definition of Gold IRA
  3. Eligible Transfer

    An IRS-allowed movement of assets into or out of an individual ...
  4. Death Master File (DMF)

    Also known as Social Security Death Index. A list of people whose ...
  5. Leveraged Benefits

    The use – by a business owner or professional practitioner – ...
  6. Peri-Retirement

    A term for the period of time leading up to actual retirement. ...
comments powered by Disqus
Related Articles
  1. When Your Job Offers An Awful Retirement ...
    Retirement

    When Your Job Offers An Awful Retirement ...

  2. Top 5 Strategies To Pay For Elder Care
    Retirement

    Top 5 Strategies To Pay For Elder Care

  3. 10 Common Retirement Planning Mistakes ...
    Retirement

    10 Common Retirement Planning Mistakes ...

  4. Power Of Attorney: Do You Need One?
    Retirement

    Power Of Attorney: Do You Need One?

  5. 7 Steps To Evaluate A Financial Adviser
    Investing Basics

    7 Steps To Evaluate A Financial Adviser

Trading Center