If I held a stock that went bankrupt and worthless in my IRA (or Rollover IRA), can I deduct it from my taxes? If so, can I do it same year as bankruptcy or once I’m at withdrawal age (59 1/2)?

Forum|Forum|10 months ago
September 6, 2025
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Best answer by xmasbaby0

Expert Reviewed

No. You cannot deduct anything on your tax return for holdings that went down within your retirement account. The values of stocks and other funds that are within your retirement account will fluctuate with the market over the years. You do not deduct anything for losses within the retirement account nor do you pay tax for gains in the market while the funds are just being held within your retirement account. Someday when you take distribution(s) from the retirement account, you will get a 1099R and pay tax on the money you took out.

xmasbaby0

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Level 15

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Hal_Al

Level 15

Expert Reviewed

Q. If I held a stock that went bankrupt and worthless in my IRA (or Rollover IRA), can I deduct it from my taxes?

A. No.

There will just be less money in the account, to pay tax on, when you do start to withdraw it after age 59.5.

VolvoGirl

Level 15

Assuming you took a tax deduction when you made the contribution or rolled over a 401k contribution that came out of your pay pre-tax, then it was never included in your income and you already got a deduction for it. You can't deduct it twice.

Losses in a traditional IRA mean that you simply have less income you need to take out and pay tax on. Taking a deduction for the loss of this pre-tax money would be double-dipping. And after 2017 a IRA Loss is no longer deductible