401k Loss Answers
Can I claim loss on 401K investments?
Q. My wife and I participate in the company 401k plan and the plan allows us to invest company contributions as well as employee contributions; some of them lost money last year. Deductible under loss?
Asked by Mallik K - Sat Mar 29 18:04:00 2008 - Investing - 4 Answers - Comments
A. There is no tax or tax loss while the assets are in the 401(k) account. The only way you could ever take a loss is if total distributions paid out of the account until it is zero balance, exceed the total contributions. So you cannot even think about 401(k) losses until the money is ALL gone. And that would be a sad day indeed.
Answered by efflandt - Sat Mar 29 18:16:11 2008
Q. My wife and I participate in the company 401k plan and the plan allows us to invest company contributions as well as employee contributions; some of them lost money last year. Deductible under loss?
Asked by Mallik K - Sat Mar 29 18:04:00 2008 - Investing - 4 Answers - Comments
A. There is no tax or tax loss while the assets are in the 401(k) account. The only way you could ever take a loss is if total distributions paid out of the account until it is zero balance, exceed the total contributions. So you cannot even think about 401(k) losses until the money is ALL gone. And that would be a sad day indeed.
Answered by efflandt - Sat Mar 29 18:16:11 2008
can I write off a loss on my General Motors 401k when they went into bankruptcy?
Q. I have a PSP 401 K from when I worked for General Motors.. I watched 38,000.00 in investments go down to 2,000.00 the year General Motors filed chapter 11. They took what was left and put it in mutual funds. I am 67 years old and this is all I have left of the little bit that I did have. Please advise. Thank You
Asked by - Sun Mar 13 13:48:48 2011 - Personal Finance - 1 Answers - Comments
Q. I have a PSP 401 K from when I worked for General Motors.. I watched 38,000.00 in investments go down to 2,000.00 the year General Motors filed chapter 11. They took what was left and put it in mutual funds. I am 67 years old and this is all I have left of the little bit that I did have. Please advise. Thank You
Asked by - Sun Mar 13 13:48:48 2011 - Personal Finance - 1 Answers - Comments
I rolled over my deceased husband 401k and it has lost 5400.00 of my original amount. loss on my tax return?
Q. Can the loss be taken off my income taxes for this year? I took it out of stocks and put in a safer program.
Asked by Edie W - Sat Jan 24 17:31:56 2009 - United States - 3 Answers - Comments
A. Unfortunately, no, that loss is not deductible on your tax return.
Answered by grey eyes - Sat Jan 24 17:39:21 2009
Q. Can the loss be taken off my income taxes for this year? I took it out of stocks and put in a safer program.
Asked by Edie W - Sat Jan 24 17:31:56 2009 - United States - 3 Answers - Comments
A. Unfortunately, no, that loss is not deductible on your tax return.
Answered by grey eyes - Sat Jan 24 17:39:21 2009
Can I deduct the loss of stock in my 401K? The company was taken over and the stock is now worthless.?
Q. I work for a bank that was taken over by the FDIC. I had about 70% of my 401 K contributions going into stock and of course the bank's matching contributions went into stock as well...can I deduct the loss?
Asked by - Sun Sep 20 13:06:52 2009 - Investing - 2 Answers - Comments
A. No, you can't. It's just gone.
Answered by . - Sun Sep 20 13:11:22 2009
Q. I work for a bank that was taken over by the FDIC. I had about 70% of my 401 K contributions going into stock and of course the bank's matching contributions went into stock as well...can I deduct the loss?
Asked by - Sun Sep 20 13:06:52 2009 - Investing - 2 Answers - Comments
A. No, you can't. It's just gone.
Answered by . - Sun Sep 20 13:11:22 2009
are you allowed to take a tax credit if you had a loss in your 401K?
Q. are you allowed to take a tax credit if you had a loss in your 401K
Asked by Phyllis - Tue Mar 3 21:31:22 2009 - Personal Finance - 3 Answers - Comments
Q. are you allowed to take a tax credit if you had a loss in your 401K
Asked by Phyllis - Tue Mar 3 21:31:22 2009 - Personal Finance - 3 Answers - Comments
filing a loss on my 401K?
Q. I lost a considerable amount of money through my 401K. will I be able to file a loss on my income taxes?
Asked by lab_vixen - Sun Jan 18 21:51:17 2009 - United States - 5 Answers - Comments
A. No. Every penny you put into a 401K (or was put in by the employer) is tax deferred, meaning tax has not been paid yet on that money. Down the road, whatever money is in there, whether it has increased or decreased in value due to market fluctuation, will be taxed when you take it out. If you've lost a significant amount of money, you won't owe as much tax. But there's no reportable loss for tax filing purposes.
Answered by curtisports2 - Sun Jan 18 21:57:59 2009
Q. I lost a considerable amount of money through my 401K. will I be able to file a loss on my income taxes?
Asked by lab_vixen - Sun Jan 18 21:51:17 2009 - United States - 5 Answers - Comments
A. No. Every penny you put into a 401K (or was put in by the employer) is tax deferred, meaning tax has not been paid yet on that money. Down the road, whatever money is in there, whether it has increased or decreased in value due to market fluctuation, will be taxed when you take it out. If you've lost a significant amount of money, you won't owe as much tax. But there's no reportable loss for tax filing purposes.
Answered by curtisports2 - Sun Jan 18 21:57:59 2009
401k rollover with a loss in it?
Q. my wife has a 401k and is approaching age to move some/all of the funds out of the 401k into a self-direct account. we have a loss of about $20,000 in her company stock. can that stock, and only that stock, be moved to an IRA. current value of about $300. if we then took a distribution would it be a taxable LOSS rather than income? thanks. not to be argumentative but clear up my own misunderstanding i guess. my 'impression' of an having an ira (or 401k for that matter) was that when 1 takes a distribution you are taxed, at current rates, on any growth of the asset. the idea being to defer those taxes until one is in a lower tax bracket. is the 'income' is a loss, why wouldnt that pass thru, just like income would? thanks to all for the… [cont.]
Asked by danielbdavis - Tue Jan 27 17:42:49 2009 - Investing - 5 Answers - Comments
A. Your impression was incorrect. You are not taxes on the increase; you are taxed on the whole distribution. The money you put in the 401k was not taxed going in therefore they're going to tax you on anything that comes out. Note: a move from a 401k to an IRA has no tax treatment because you are moving from one tax deferred plan to another. You would pay the same taxes on the distribution whether it came from an IRA or a 401k
Answered by wildbirdie - Tue Jan 27 19:54:45 2009
Q. my wife has a 401k and is approaching age to move some/all of the funds out of the 401k into a self-direct account. we have a loss of about $20,000 in her company stock. can that stock, and only that stock, be moved to an IRA. current value of about $300. if we then took a distribution would it be a taxable LOSS rather than income? thanks. not to be argumentative but clear up my own misunderstanding i guess. my 'impression' of an having an ira (or 401k for that matter) was that when 1 takes a distribution you are taxed, at current rates, on any growth of the asset. the idea being to defer those taxes until one is in a lower tax bracket. is the 'income' is a loss, why wouldnt that pass thru, just like income would? thanks to all for the… [cont.]
Asked by danielbdavis - Tue Jan 27 17:42:49 2009 - Investing - 5 Answers - Comments
A. Your impression was incorrect. You are not taxes on the increase; you are taxed on the whole distribution. The money you put in the 401k was not taxed going in therefore they're going to tax you on anything that comes out. Note: a move from a 401k to an IRA has no tax treatment because you are moving from one tax deferred plan to another. You would pay the same taxes on the distribution whether it came from an IRA or a 401k
Answered by wildbirdie - Tue Jan 27 19:54:45 2009
When an Ex Gets marry does she losses her 401k benefit?
Q. This in california. My Ex just got married and she even told me I can stop my automatic spausal deduccion, but I do not know if she also losses her benefit of my 401k
Asked by Juan o - Tue Jul 7 19:21:06 2009 - Marriage & Divorce - 5 Answers - Comments
A. She would get only a Pro Rated amount of the 401K from the time you where married right up till the end of the divorce. If she wants he share of the possible allowed amount then she would have to pay the Tax and Penaly for to cash out. If she wants it Rolled Over then she would have to sort that out as well. If I where you I would I file an Ex-Parte Motion on an existing order to have the Judge give the decision.
Answered by WB1 - Tue Jul 7 19:28:56 2009
Q. This in california. My Ex just got married and she even told me I can stop my automatic spausal deduccion, but I do not know if she also losses her benefit of my 401k
Asked by Juan o - Tue Jul 7 19:21:06 2009 - Marriage & Divorce - 5 Answers - Comments
A. She would get only a Pro Rated amount of the 401K from the time you where married right up till the end of the divorce. If she wants he share of the possible allowed amount then she would have to pay the Tax and Penaly for to cash out. If she wants it Rolled Over then she would have to sort that out as well. If I where you I would I file an Ex-Parte Motion on an existing order to have the Judge give the decision.
Answered by WB1 - Tue Jul 7 19:28:56 2009
What happens if you default on a 401K loan?
Q. Lost a large portion of household income, can no longer afford to cover the mortgage and repay 401k loan (used to consolidate prior to the loss), facing foreclosure or default of loan. Aware of it being turned over to the IRS, but then what? Current employment (two jobs) isn't enough to cover debt.
Asked by "V" - Sun Dec 30 19:34:05 2007 - Personal Finance - 2 Answers - Comments
A. Check with the plan, but a default is generally considered a withdrawal of funds. This will be a nightmare of a tax bill (plan on 25-35% to taxes) and you don't have the money for retirement.
Answered by a tax lady - Sun Dec 30 20:13:12 2007
Q. Lost a large portion of household income, can no longer afford to cover the mortgage and repay 401k loan (used to consolidate prior to the loss), facing foreclosure or default of loan. Aware of it being turned over to the IRS, but then what? Current employment (two jobs) isn't enough to cover debt.
Asked by "V" - Sun Dec 30 19:34:05 2007 - Personal Finance - 2 Answers - Comments
A. Check with the plan, but a default is generally considered a withdrawal of funds. This will be a nightmare of a tax bill (plan on 25-35% to taxes) and you don't have the money for retirement.
Answered by a tax lady - Sun Dec 30 20:13:12 2007
I am starting all over at 38 years old. I had 401K but had to deplete it after a job loss.?
Q. I now work for a school district and of course they don't have 401K or match anything. I don't have a lot of money to spare (maybe $50 per month). How should I plan for my retirement? Roth IRA? IRA? Investments? If so, which ones? I am also looking to buy a house in the next year or two.
Asked by Crystal V - Sat Feb 7 10:18:25 2009 - Personal Finance - 3 Answers - Comments
A. well chances are you do not need tax deferred dollars so i would take the 50 dollars and open an roth ira at your bank -- by the time you reach 65 you will have a tidy little sum stashed away!!!
Answered by mister ed - Sat Feb 7 12:05:41 2009
Q. I now work for a school district and of course they don't have 401K or match anything. I don't have a lot of money to spare (maybe $50 per month). How should I plan for my retirement? Roth IRA? IRA? Investments? If so, which ones? I am also looking to buy a house in the next year or two.
Asked by Crystal V - Sat Feb 7 10:18:25 2009 - Personal Finance - 3 Answers - Comments
A. well chances are you do not need tax deferred dollars so i would take the 50 dollars and open an roth ira at your bank -- by the time you reach 65 you will have a tidy little sum stashed away!!!
Answered by mister ed - Sat Feb 7 12:05:41 2009
is there a tax break for a loss on 401K for retired people?
Q. I know there is "capitol gain" but is there "capitol loss"?
Asked by Joyce B - Tue Feb 17 14:22:50 2009 - United States - 3 Answers - Comments
A. The term is "capital" gain, not "capitol" gain, and it does not apply to a 401K. If this is a normal 401K and all contributions were pretax, then the only tax break is that you pay less tax on the distributions (because there will be less to distribute). If this is a Roth 401K, then you may be able to deduct a "capital loss" after all funds in the account have been distributed.
Answered by StephenWeinstein - Tue Feb 17 14:32:43 2009
Q. I know there is "capitol gain" but is there "capitol loss"?
Asked by Joyce B - Tue Feb 17 14:22:50 2009 - United States - 3 Answers - Comments
A. The term is "capital" gain, not "capitol" gain, and it does not apply to a 401K. If this is a normal 401K and all contributions were pretax, then the only tax break is that you pay less tax on the distributions (because there will be less to distribute). If this is a Roth 401K, then you may be able to deduct a "capital loss" after all funds in the account have been distributed.
Answered by StephenWeinstein - Tue Feb 17 14:32:43 2009
Why do some 401K mutual funds take a loss of 6-15% on a single day in December? How is this legal?
Q. Check out ticker ARTIX on Dec 19, 2007. Why the huge drop? The markets certainly didn't take that kind of hit. It seems like money managers are juggling numbers around at the expense of the average retirement investor.
Asked by John N - Thu Dec 20 01:15:12 2007 - Investing - 4 Answers - Comments
A. December is typically the time of year when mutual funds make dividend and capital gains payouts to their shareholders. If the shareholder is reinvesting those dividends then there is zero difference in the overall account balance for the shareholder as the NAV will drop exactly the amount of the dividend but the shares will increase proportionately. Here's an example: Let's say mutual fund company A has 1000 shares outstanding and each share is worth $100. That means the overall assets of the fund are $100,000. For tax purposes the fund is required (not by choice but by law) to pay out $10,000 in capital gains to it's shareholders. So they declare a $10 capital gain distribution. They pay that out in cash. The new overall assets of the… [cont.]
Answered by digdowndeepnseattle - Thu Dec 20 10:09:29 2007
Q. Check out ticker ARTIX on Dec 19, 2007. Why the huge drop? The markets certainly didn't take that kind of hit. It seems like money managers are juggling numbers around at the expense of the average retirement investor.
Asked by John N - Thu Dec 20 01:15:12 2007 - Investing - 4 Answers - Comments
A. December is typically the time of year when mutual funds make dividend and capital gains payouts to their shareholders. If the shareholder is reinvesting those dividends then there is zero difference in the overall account balance for the shareholder as the NAV will drop exactly the amount of the dividend but the shares will increase proportionately. Here's an example: Let's say mutual fund company A has 1000 shares outstanding and each share is worth $100. That means the overall assets of the fund are $100,000. For tax purposes the fund is required (not by choice but by law) to pay out $10,000 in capital gains to it's shareholders. So they declare a $10 capital gain distribution. They pay that out in cash. The new overall assets of the… [cont.]
Answered by digdowndeepnseattle - Thu Dec 20 10:09:29 2007
Why don't Americans acknowledge that Obama has recovered most of their 401k losses under Bush?
Q. The Stock Market seems to love Obama even if some of us are not the biggest Obama fans at this time.
Asked by Parson Brown - Sun Dec 19 15:37:30 2010 - Politics - 16 Answers - 1 Comments
A. Cons are always on here when the stock market dips to castigate President Obama for it. Their claims therefore that he doesn t deserve any credit for the good stock market sound a bit hypocritical. If there were a Republican president, these same people would be praising that Republican president for the rise in the stock market. They would be bragging about how good Republicans are at economics, while we all know that in reality they are just terrible.
Answered by tribeca_belle - Sun Dec 19 15:51:36 2010
Q. The Stock Market seems to love Obama even if some of us are not the biggest Obama fans at this time.
Asked by Parson Brown - Sun Dec 19 15:37:30 2010 - Politics - 16 Answers - 1 Comments
A. Cons are always on here when the stock market dips to castigate President Obama for it. Their claims therefore that he doesn t deserve any credit for the good stock market sound a bit hypocritical. If there were a Republican president, these same people would be praising that Republican president for the rise in the stock market. They would be bragging about how good Republicans are at economics, while we all know that in reality they are just terrible.
Answered by tribeca_belle - Sun Dec 19 15:51:36 2010
Can I borrow on my 401k loan to cover the loss of my wife's income?
Q. My wife is leaving for Florida at the end of the week to help her mother who just had a stroke, We live in Utah. She is taking FMLA for 2 weeks to help her mother. My wife has power of attorney, in behalf of her mother. I have enough money in the 401k. My question is can I take a loan on my 401k to cover the 2 weeks loss of pay by my wife?
Asked by LEHI - Sun Nov 29 09:05:56 2009 - Personal Finance - 4 Answers - 1 Comments
A. ONLY your employer can tell you if you plan allows loans. If it does, the amount of the loan is most likely limited to 50% of the value of your account. That said, borrowing from a 401(k) is almost always a LOUSY idea. It ranks right up with payday loans on the scale of smart financial decisions.
Answered by STEVEN F - Sun Nov 29 09:25:44 2009
Q. My wife is leaving for Florida at the end of the week to help her mother who just had a stroke, We live in Utah. She is taking FMLA for 2 weeks to help her mother. My wife has power of attorney, in behalf of her mother. I have enough money in the 401k. My question is can I take a loan on my 401k to cover the 2 weeks loss of pay by my wife?
Asked by LEHI - Sun Nov 29 09:05:56 2009 - Personal Finance - 4 Answers - 1 Comments
A. ONLY your employer can tell you if you plan allows loans. If it does, the amount of the loan is most likely limited to 50% of the value of your account. That said, borrowing from a 401(k) is almost always a LOUSY idea. It ranks right up with payday loans on the scale of smart financial decisions.
Answered by STEVEN F - Sun Nov 29 09:25:44 2009
what is the downside if I stop contributing to my 401k for about 4 months?
Q. I am in a financial bind for the next 4-6 months and I am at my last resort of holding back my normal 401K deductions from my paycheck; or maybe just change it to 1% of my pay. Other than the obvious loss of money which my 401K grows with, are there any other negatives I am not aware of?
Asked by emailfordon - Mon Aug 18 21:28:50 2008 - Personal Finance - 3 Answers - Comments
A. little bit higher taxes for 2008 little bit lower of return in long run in 401k Possibly missing out on match money. Most important is to check the rules of the plan. Some still allow such changes only quarterly (although you can go to zero at any time). If yours is such a plan then you may have to stay out the entire 6 months. Make sure you get back in when the cash crunch ends. This is far better than taking a withdrawal so no one should beat you up over this decision.
Answered by digdowndeepnseattle - Tue Aug 19 10:14:51 2008
Q. I am in a financial bind for the next 4-6 months and I am at my last resort of holding back my normal 401K deductions from my paycheck; or maybe just change it to 1% of my pay. Other than the obvious loss of money which my 401K grows with, are there any other negatives I am not aware of?
Asked by emailfordon - Mon Aug 18 21:28:50 2008 - Personal Finance - 3 Answers - Comments
A. little bit higher taxes for 2008 little bit lower of return in long run in 401k Possibly missing out on match money. Most important is to check the rules of the plan. Some still allow such changes only quarterly (although you can go to zero at any time). If yours is such a plan then you may have to stay out the entire 6 months. Make sure you get back in when the cash crunch ends. This is far better than taking a withdrawal so no one should beat you up over this decision.
Answered by digdowndeepnseattle - Tue Aug 19 10:14:51 2008
If i took out of my 401k due to illness , & job loss do i have to pay ny state taxes? the 401k was taken out?
Q. twice the second time closed out. Age 50, no other income & would these circumstance also effect my federal taxes?
Asked by Sue - Fri Apr 4 11:18:44 2008 - United States - 1 Answers - Comments
A. You will have to pay Federal and NY state income tax on this distribution. There is also a 10% Federal early distribution penalty for taking the money out before age 59 1/2. There are some exceptions to the 10% penalty (but not the income tax itself), such as if you are permanently disabled or have medical deductions in excess of 7.5% of your adjusted gross income. Read more in IRS publication 575.
Answered by cynic47 - Fri Apr 4 14:13:11 2008
Q. twice the second time closed out. Age 50, no other income & would these circumstance also effect my federal taxes?
Asked by Sue - Fri Apr 4 11:18:44 2008 - United States - 1 Answers - Comments
A. You will have to pay Federal and NY state income tax on this distribution. There is also a 10% Federal early distribution penalty for taking the money out before age 59 1/2. There are some exceptions to the 10% penalty (but not the income tax itself), such as if you are permanently disabled or have medical deductions in excess of 7.5% of your adjusted gross income. Read more in IRS publication 575.
Answered by cynic47 - Fri Apr 4 14:13:11 2008
Can losses in a 401K be deducted if I take early withdraw?
Q. 10 years ago, I invested $15,000 (from a Pension for a company that I left) into 401K account. The account is now worth $5000. If I take an early distribution what penalties will I have to pay? I.e. 10% plus income Tax? Assuming I do pay the penalty and Income tax, can I claim the $10,000 in Losses that I realized by selling and taking the distribution?
Asked by - Sat Oct 16 13:50:52 2010 - United States - 7 Answers - Comments
A. No, losses in a 401(k) are NEVER deductible. You never paid tax on that money in the first place so there's nothing that you can deduct. ANY distribution from the account are fully taxable in the year of the distribution. Additionally, if you are under age 59 1/2 at the time of the distribution there's a 10% penalty on top of the tax. The 10% penalty is NOT a "surtax" but is assessed on the gross distribution. On a $5,000 distribution it would be $500 regardless of what the tax on the distribution is. If the distro was your only income for the year there would be no tax due, but you'd still pay the 10% penalty.
Answered by Bostonian In MO - Sat Oct 16 13:58:09 2010
Q. 10 years ago, I invested $15,000 (from a Pension for a company that I left) into 401K account. The account is now worth $5000. If I take an early distribution what penalties will I have to pay? I.e. 10% plus income Tax? Assuming I do pay the penalty and Income tax, can I claim the $10,000 in Losses that I realized by selling and taking the distribution?
Asked by - Sat Oct 16 13:50:52 2010 - United States - 7 Answers - Comments
A. No, losses in a 401(k) are NEVER deductible. You never paid tax on that money in the first place so there's nothing that you can deduct. ANY distribution from the account are fully taxable in the year of the distribution. Additionally, if you are under age 59 1/2 at the time of the distribution there's a 10% penalty on top of the tax. The 10% penalty is NOT a "surtax" but is assessed on the gross distribution. On a $5,000 distribution it would be $500 regardless of what the tax on the distribution is. If the distro was your only income for the year there would be no tax due, but you'd still pay the 10% penalty.
Answered by Bostonian In MO - Sat Oct 16 13:58:09 2010
Does the history of captial gains/losses from 401K accounts get counted?
Q. What happens to all the captial gains/losses from a 401k account. For example, say you start contributing to a 401k when you are 25 years old for 20 years and do the reallocating of assets (stock, bonds, fixed investments, matching stocks). I know while you have the 401K active, as long as the transaction is in a 401k, it's a non tax event. But what happens when comes time to cash in the 401K? Does the history of gains/losses count? To give a particular example, let's say right now, I have assets as stock funds, bond funds, interest income and company matching. Before I cash it out, I transfer everything to interest income for safety. How then does the taxes get treated? thx
Asked by QueAndAy - Sun Jul 15 11:43:48 2007 - United States - 5 Answers - Comments
A. For tax purposes, the money in a 401(k) does not exist until it is taken out of the 401(k). At that point, the FULL amount is ordinary income. Anything that happened while the money was inside the account in meaningless for tax purposes.
Answered by STEVEN F - Sun Jul 15 21:40:27 2007
Q. What happens to all the captial gains/losses from a 401k account. For example, say you start contributing to a 401k when you are 25 years old for 20 years and do the reallocating of assets (stock, bonds, fixed investments, matching stocks). I know while you have the 401K active, as long as the transaction is in a 401k, it's a non tax event. But what happens when comes time to cash in the 401K? Does the history of gains/losses count? To give a particular example, let's say right now, I have assets as stock funds, bond funds, interest income and company matching. Before I cash it out, I transfer everything to interest income for safety. How then does the taxes get treated? thx
Asked by QueAndAy - Sun Jul 15 11:43:48 2007 - United States - 5 Answers - Comments
A. For tax purposes, the money in a 401(k) does not exist until it is taken out of the 401(k). At that point, the FULL amount is ordinary income. Anything that happened while the money was inside the account in meaningless for tax purposes.
Answered by STEVEN F - Sun Jul 15 21:40:27 2007
Tax on 401k/IRA loss?
Q. What, if any, loss can I reduce from taxes? Say I had contributed (via 401k) a total of $100,000 before taxes and rolled over into an IRA without further contribution over 5+ years. Given the market situation, the current value of IRA is now $60,000. Say I'd want to make a complete distribution, ie, receive the $60,000. I understand that I'd have to claim $60,000 as additional taxable income and have to (under 59) pay an additional penalty of 10% on the $60,000k. Can I claim the "loss" of $40,000 somewhere though and offset some of the tx burden?
Asked by JK - Mon Mar 9 08:51:23 2009 - United States - 2 Answers - Comments
A. No. Losses in Pre-tax accounts are never deductible. You would have to pay taxes on the $60k plus the 10% penalty but there is no deduction for the loss in value. Losses on closed out IRAs are only deductible if you had an after-tax basis in the IRA and you do not.
Answered by Wayne Z - Mon Mar 9 09:00:34 2009
Q. What, if any, loss can I reduce from taxes? Say I had contributed (via 401k) a total of $100,000 before taxes and rolled over into an IRA without further contribution over 5+ years. Given the market situation, the current value of IRA is now $60,000. Say I'd want to make a complete distribution, ie, receive the $60,000. I understand that I'd have to claim $60,000 as additional taxable income and have to (under 59) pay an additional penalty of 10% on the $60,000k. Can I claim the "loss" of $40,000 somewhere though and offset some of the tx burden?
Asked by JK - Mon Mar 9 08:51:23 2009 - United States - 2 Answers - Comments
A. No. Losses in Pre-tax accounts are never deductible. You would have to pay taxes on the $60k plus the 10% penalty but there is no deduction for the loss in value. Losses on closed out IRAs are only deductible if you had an after-tax basis in the IRA and you do not.
Answered by Wayne Z - Mon Mar 9 09:00:34 2009
Should I re-allocate my 401k wealth to the conservative stocks to prevent further loss of money?
Q. I am 31 yrs old. General allocation of my 401K is 15% conservative, 45% moderate, and40% aggressive. There was a loss in the last quarter. Please advice me. Thanks
Asked by dzing - Fri Jan 25 13:52:26 2008 - Investing - 5 Answers - Comments
A. Stick with what you have. Of course you have a loss right now, the markets are volatile. To jump ship now just locks in your losses. Your moderate-aggressive weighting is always going to bounce up and down, but over the LONG haul, it's appropriate for someone of your age. You've got many years to recover, there is no need to 'prevent further loss of money'. Long term, that's what you have to be thinking of. If it bothers you, stop reading the business news. It will all end up being okay. In the long run.
Answered by Quizzard - Fri Jan 25 14:04:38 2008
Q. I am 31 yrs old. General allocation of my 401K is 15% conservative, 45% moderate, and40% aggressive. There was a loss in the last quarter. Please advice me. Thanks
Asked by dzing - Fri Jan 25 13:52:26 2008 - Investing - 5 Answers - Comments
A. Stick with what you have. Of course you have a loss right now, the markets are volatile. To jump ship now just locks in your losses. Your moderate-aggressive weighting is always going to bounce up and down, but over the LONG haul, it's appropriate for someone of your age. You've got many years to recover, there is no need to 'prevent further loss of money'. Long term, that's what you have to be thinking of. If it bothers you, stop reading the business news. It will all end up being okay. In the long run.
Answered by Quizzard - Fri Jan 25 14:04:38 2008
From Yahoo Answer Search: '401k loss'
Sun Jan 15 19:54:52 2012