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Megan C
Megan C, Certified Public Accountant (CPA)
Category: Finance
Satisfied Customers: 16544
Experience:  Licensed CPA, CFE, CMA, CGMA who teaches accounting courses at Master's Level
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I converted a portion of my standard IRA over to a Roth IRA

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I converted a portion of my standard IRA over to a Roth IRA in 2012. I am pretty sure that I will be taxed based on the regular income tax rate, such as what I will pay for salary (let's say it is 28%). Did I state that correctly?

I have more than $3,000 in losses in Capital Gains. Can I offset any of the Capital Gain losses (beyond the $3,000) against the monies I converted over to the Roth IRA?
Thank you for your question, and thanks for using JustAnswer.com.

When you convert your traditional IRA to a Roth IRA, you incur ordinary income. Therefore, you can only deduct up to $3,000 of capital losses against this amount. So no, you cannot offset your capital losses with your Roth conversion.

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You should be aware that your question, as with most tax questions, can never really be answered completely...addressing all the permutations; that is because of the many assumptions that have to be made I have done my best to determine what I think you are asking and answering it in the most direct and understandable manner possible. If, however, after reviewing the questions, you have any uncertainties or further questions, please do not hesitate to ask.
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