Capital Gains Taxes on Inherited Roth
For a Roth IRA that I recently inherited that consists of stocks and mutual funds, if I sell these assets, am I still not liable for Capital Gains taxes? The Roth is past the 5-year rule. Thanks
For a Roth IRA that I recently inherited that consists of stocks and mutual funds, if I sell these assets, am I still not liable for Capital Gains taxes? The Roth is past the 5-year rule. Thanks
Permalink Submitted by Alan - IRA critic on Thu, 2021-04-15 16:21
First, there are no cap gain tax rates applicable to IRAs. If a distribution is made from the Roth IRA and is taxable the rate will be the ordinary income rate. However, since the decedent first contributed over 5 years ago and has now passed, this Roth is qualified and completly tax free. You also need to determine if you are subject to the 10 year rule, 5 year rule if you inherited through owner’s estate, or are an eligible designated beneficiary for the stretch.