Using carryover Capital loss in a IRA or 401k distribution

Forum|Forum|2 years ago
January 5, 2024
3 replies
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If I have capital gains in a retirement account, when I take a distribution, can I use my carryover capital loss to offset the capital gains in that distribution, or does it just become a normal distribution that is fully added to my income for tax purposes?

TurboTax Home & Biz Windows

Best answer by TomD8

As a result of the Tax Cuts and Jobs Act, the option to claim a loss on IRA investments is no longer available as of 2018.

Anonymous_

Employee

@dmertz

TomD8Answer

Employee

As a result of the Tax Cuts and Jobs Act, the option to claim a loss on IRA investments is no longer available as of 2018.

**Answers are correct to the best of my ability but do not constitute tax or legal advice.

Mike9241

for as long as there have been IRAs capital gains and losses inside an IRA are never recognized by the beneficiary. Those capital gains become ordinary income when you take a distribution. there was a provision, since repealed, that allowed recognizing a loss under certain conditions.

dmertz

Employee

Gains and losses within a retirement account are not reportable. Distributions from a retirement account are ordinary income and are not subject to any capital-gains treatment.