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Ed Johnson
Ed Johnson, Tax Preparer
Category: Tax
Satisfied Customers: 10760
Experience:  GPHR Cert; U.S. Treasury Tax Advocacy Panel appointee
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I pay an investment advisor with regard to my IRA. Is his ...

Resolved Question:

I pay an investment advisor with regard to my IRA. Is his fee deductible as investment advice producing taxable income (because I will eventually be taxed on the gains of my IRA)?
Submitted: 9 years ago.
Category: Tax
Expert:  Ed Johnson replied 9 years ago.

DearCustomer

Thank you for your quesiton.

The following are considered taxable investment expenses:

  1. Accounting fees for record keeping;
  2. Expenses of proxy fights when legitimate corporate policies are involved;
  3. Fees for collecting taxable interest and dividends;
  4. Fees shown in Box 5 of Form 1099-DIV;
  5. Guardian fees of a minor incurred in collecting or producing income;
  6. Investment manager and planner fees to the extent that they relate to taxable income;
  7. IRA setup and administration fees;
  8. Legal fees
  9. Safe deposit box fees used exclusively to hold taxable income generating securities and investments;
  10. Salaries of persons hired to keep records of your taxable investment income; and
  11. Subscriptions to investment services.

As long as the fee is paid seperately from IRA funds, and not taken directly out of the fund itself, then they would be deductable subject to the 2 percent floor.

 

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