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Strategies & Market Trends : Roth IRA ideas -- Ignore unavailable to you. Want to Upgrade?

To: sea_biscuit who wrote (64)	2/16/1998 5:47:00 PM
From: Jason Rooks	Read Replies (1) \| Respond to of 388

Dipy, That certainly sounds wise. I posted a scenario a few weeks ago surmising that I made a mistake in transferring 3 small cap, depreciated stocks to an IRA because I probably should have sold them for cash, realized the loss, then transferred the cash to the IRA and bought the same stocks, which hopefully appreciate tax free. Alas, my original hope to take the loss on account that the transfer into the IRA would be a taxable event seems less likely if I consider the unfair scenario of transferring appreciated stocks into an IRA and whether one would have to pay capital gains on that transaction. Thoughts on whether the IRS considers contributions to an IRA of stock a taxable event, i.e. capital gains/losses?

To: sea_biscuit who wrote (64)	3/13/1998 9:23:00 AM
From: Jim O'Hare	Read Replies (2) \| Respond to of 388

Is a Roth IRA a smart idea? I guess I might be missing something. The Roth IRA contributions are post tax investments. If I took the money and put it in a Roth IRA I would have to pay ordinary income tax when I withdrew the funds after retirement. If I took the same funds I could invest them in a S&P Index fund or Spiders which currently pay only about 1.45 % a year in dividends. When its time to retire I would only pay 20% in capital gains (18% on funds invested after Y2K)vs the current federal income tax rate of either 28% or 30%. In addition, this option would not have the million restrictions on withdrawal of funds that IRA's have. I ran the numbers on a spreadsheet and the investor in Spiders comes out slightly ahead (including yearly dividend tax payments) than the investor in the Roth IRA. Am I missing something?