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| Initial IRA contributions should always be into tradition IRA. Then when a tough year comes along, like some are experiencing now, it would be possible to take retirement funds that were contributed tax free (traditional) and convert them into a ROTH, the gain or penalty incurred by the transfer would be counted as income, but since the operation showed a loss for the year, that income would be recognized (reducing the loss for the year). ROTH iras withdrawals are tax free, so no tax was initially paid going in, and no taxes will be levied coming out. Farming is a volatile enterprise, and chances are that somewhere through a farmers career, a loss is certainly possible, this is just 1 way to take advantage of a bad situation. | |
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Anyone else showing a loss on their taxes?
