Investment Expenses
Hello: a client of mine has investment expenses taken directly out of her IRA account, meaning the brokerage house just debited the money for annual account fee and money management fees. Will these expenses tax deductible subject to 2% AGI? I tend to think not as we then have to report these expenses as part of taxable income, isn’t it? Thanks!
Permalink Submitted by mk foss on Tue, 2009-03-10 22:12
Investment expenses related to an IRA are only deductible if paid outside the IRA. They would not be deductible under the circumstances you describe.
Permalink Submitted by Alan Spross on Tue, 2009-03-10 23:12
She shouldn’t feel too bad about this. As long as the IRA was not a Roth IRA, she has paid the fees with pre tax money. Entering an era of diminishing returns and higher taxes down the road, this may be the preferable option to take. Before she asks for a separate bill next year, she should be sure that she can both itemize deductions, and has misc deductions that absorb the full 2% of AGI floor that applies to these misc deductions.
Permalink Submitted by Annie Hung-Scanga on Tue, 2009-03-10 23:55
thank you both!