Tax deduction on Roth loss.
Last year my client liquidated a Roth Conversion acct for $15000. The conversion was done 8 years ago is she was over 59 1/2. Her conversion amount and contributions over the years was $18000. Her tax preparer said she could claim the $3000 loss as an itemized tax deduction. Is this right? Terry A
Permalink Submitted by Edward Czapor on Thu, 2009-09-03 20:08
Yes that is correct as long as the liquidation is for ALL of her Roth accounts. The loss is a miscellaneous itemized deduction subject to the 2% of AGI limitation.