The money was then put into a college savings and retirement for the kids, I had to remove the money to buy a new home(which was a better investment)I lost money from the stock market on doing this, the questions is do I have to claim this money on my taxes now?
2007-03-11 06:45:56 · 6 answers · asked by hvacrjohn 2 in Business & Finance ➔ Taxes ➔ United States
A retirement account for the kids doesn't make sense to me. Did the children have income, and you funded their retirement accounts?
The life insurance money was not taxed. However, if you invested money in a retirement account and took a tax deduction for that, such as a traditional IRA, then when the money is taken out, it is taxable. Same goes for a college savings account, if you took a tax deduction when that money was invested.
If you gave money to your children, and then they took the money out, the taxability of those amounts depends on the other income of the children and the type of investment (tax-deferred, tax-deductible, or not).
If your investment lost money outside of a tax-deferred account, then you may have a deductible loss.
If your investment lost money inside of a tax-deferred account, and you took that money out, you have no loss to deduct.
Finally, if you took money out of an IRA and used it to by a home, you may be able to exclude some tax depending on the type of IRA.
Hope you can find a good advisor to help you out with this.
2007-03-11 18:55:36 · answer #1 · answered by ninasgramma 7 · 0⤊ 0⤋
Depending on your other income, you may not have been allowed to put the money in a retirement account to begin with. A tax expert will need more details to give you a correct answer.
2007-03-11 13:55:47 · answer #2 · answered by STEVEN F 7 · 0⤊ 0⤋
Life insurance is tax exempt under the IRS code. You can still take your stock losses on Schedule D.
2007-03-11 21:33:02 · answer #3 · answered by spicertax 5 · 0⤊ 0⤋
NO,My husband passed away and I didn't have to pay taxes on the money but you do have to pay taxes on the interest.
2007-03-11 13:51:07 · answer #4 · answered by cbt 1 · 0⤊ 1⤋
Yes, you have to claim it on taxes if it's not your first home, which i assume it's not. At least that's what the case was for us. However, it probably differs from state to state.
2007-03-11 13:49:02 · answer #5 · answered by sunny 3 · 0⤊ 2⤋
i think its possible to
2007-03-11 13:48:03 · answer #6 · answered by This user has been deleted. 3 · 0⤊ 2⤋