Defer capital gain when moving bond from taxable to IRA

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vchiu25
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Joined: Sun Jul 01, 2012 7:38 pm

Defer capital gain when moving bond from taxable to IRA

Post by vchiu25 » Thu Jun 19, 2014 12:17 am

Hello everyone,

I have been indexing for a while but havent paid attention to portfolio allocation. Its now coming back to bite me.

I'm considering shuffle my portfolio allocation according to Principles of tax-efficient fund placement in the wiki. I'm wondering if there is a way for defer the capital gain when I transfer from taxable to sheltered account?

Thanks

bnes
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Re: Defer capital gain when moving bond from taxable to IRA

Post by bnes » Thu Jun 19, 2014 12:33 am

Sorry, no.
But you can donate appreciated securities without paying the tax.

Retread
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Location: Southwest Florida

Re: Defer capital gain when moving bond from taxable to IRA

Post by Retread » Thu Jun 19, 2014 8:47 am

bnes wrote:Sorry, no.
But you can donate appreciated securities without paying the tax.
...that is, to charity.
Bruce
absit iniuria verbis

DSInvestor
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Re: Defer capital gain when moving bond from taxable to IRA

Post by DSInvestor » Thu Jun 19, 2014 9:44 am

Are you selling a bond fund in a taxable account? If you've been reinvesting dividends in your bond fund, you may find that your cost basis is higher than you think. Your brokerage account should have a display of cost basis for each holding in your taxable account.

Cost basis = purchases + reinvested dividends/cap gain distributions.

There may be little or no capital gain even if your bond fund position is worth more than your purchase amounts.
Wiki

placeholder
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Re: Defer capital gain when moving bond from taxable to IRA

Post by placeholder » Thu Jun 19, 2014 12:34 pm

Just to clarify contributions to an IRA must be in cash although transfers or rollovers can be of assets however there is no transfer/rollover possible from taxable to a tax advantaged account.

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grabiner
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Re: Defer capital gain when moving bond from taxable to IRA

Post by grabiner » Fri Jun 20, 2014 11:05 pm

placeholder wrote:Just to clarify contributions to an IRA must be in cash although transfers or rollovers can be of assets however there is no transfer/rollover possible from taxable to a tax advantaged account.
For example, Vanguard will let you move $5500 from Fund X in taxable to Fund X in an IRA, but this is still treated as a sale and purchase for tax purposes. (And don't do this if you have a capital loss in the shares you sell of Fund X; buy a different fund instead, or you won't be able to deduct the loss because of the wash sale rules.)
Wiki David Grabiner

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