Retired, husband has earned income, transferring tax paid stock to roth

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BelieveGod
Posts: 22
Joined: Thu Feb 15, 2018 10:56 am

Retired, husband has earned income, transferring tax paid stock to roth

Post by BelieveGod »

I am retired and I want to add money to my Roth. Husband has earned income of at least $7000. I understand that we both can add maximum of $7000/year to an independent roth since he has earned income of at least that amount. I plan to add $7000 from money I have paid tax. My question is: I have Stock that I am losing money but have good dividends. It is in an account that I have already paid tax on. I plan to hold stock and I hope it will rise back to price I paid. If I move $7000 (Maximum/year) worth of Stock from my regular tax paid brokerage account to my roth, how will the loss be reported by my brokerage. My brokerage can move shares of stock from my account to my roth.

This is separate from moving TSP 401K to brokerage IRA to brokerage Roth. I also do this, and I pay tax on this money. I do not have to take Minimum Required Distributions yet (MRD). I can transfer any amount of money using this method.

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Snapdragon
Posts: 238
Joined: Tue Jan 29, 2013 5:26 pm

Re: Retired, husband has earned income, transferring tax paid stock to roth

Post by Snapdragon »

I don't know. Don't they have to sell the stock before they convert it to a Roth? (I don't know, but what I was thinking) If so, brokerage will show that loss and you would owe taxes on what you convert to a Roth. Not sure they would cancel out, that would depend on many factors.

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evilanne
Posts: 2003
Joined: Thu May 14, 2015 6:52 pm

Re: Retired, husband has earned income, transferring tax paid stock to roth

Post by evilanne »

Suggest you contact your financial advisor. If allowed, I think it should be reported on your 1099-B/COMP with any dividends you got during the year prior to moving it and I think the loss should be shown as a sale based on the price on the date of transfer (not sure if they reprice it when it goes into your Roth or not). You need to make sure that you transfer $7000 or less or you will have excess contribution. It is best to talk to whoever is handling the transaction.

EionBishop
Posts: 2
Joined: Thu Apr 08, 2021 7:16 am

Re: Retired, husband has earned income, transferring tax paid stock to roth

Post by EionBishop »

I think you should contact your financial advisor. He would help you better.

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