IRA Question
I used a traditional IRA to invest in a company in 2015. In 2018 I converted the traditional IRA to a Roth IRA. The company has since closed and the shares are worthless. My understanding is that I can’t undo that 2018 conversion so I have to pay the taxes on the conversion for a valueless investment. Is my understanding correct or is there anything else I can do?
Permalink Submitted by Alan - IRA critic on Mon, 2019-03-04 18:49
No. Bad timing all around. Stock becomes worthless in the first year that a conversion cannot be recharacterized. Further, if this is your only Roth IRA balance making your Roth worth nothing, you can also no longer claim a misc deduction for the loss by closing your Roth.