Tax loss on Roth IRA

If the ultimate result of investing in a Roth IRA is a loss, how is the loss deductible if taken in retirement?



Mark,

When the summed balance of all of your ROTH IRAs is less than your basis in all of your ROTH IRAs, you may be able to claim the loss by closing all of your ROTH IRAs. This loss is claimed as a misellaneous deduction on Schedule A subject to 2% of your AGI.

See IRS Pub 590, Individual Retirement Arrangements, page 70, Recognizing Losses on Investments: http://www.irs.gov/pub/irs-pdf/p590.pdf



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