topic Using carryover Capital loss in a IRA or 401k distribution in Deductions & credits

Using carryover Capital loss in a IRA or 401k distribution

hesformes — Tue, 10 Feb 2026 10:17:07 GMT

If I have capital gains in a retirement account, when I take a distribution, can I use my carryover capital loss to offset the capital gains in that distribution, or does it just become a normal distribution that is fully added to my income for tax purposes?

Re: Using carryover Capital loss in a IRA or 401k distribution

Anonymous_ — Fri, 05 Jan 2024 15:26:49 GMT

@dmertz

Re: Using carryover Capital loss in a IRA or 401k distribution

TomD8 — Fri, 05 Jan 2024 15:38:26 GMT

As a result of the Tax Cuts and Jobs Act, the option to claim a loss on IRA investments is no longer available as of 2018.

Re: Using carryover Capital loss in a IRA or 401k distribution

Mike9241 — Fri, 05 Jan 2024 17:18:11 GMT

for as long as there have been IRAs capital gains and losses inside an IRA are never recognized by the beneficiary. Those capital gains become ordinary income when you take a distribution. there was a provision, since repealed, that allowed recognizing a loss under certain conditions.

Re: Using carryover Capital loss in a IRA or 401k distribution

dmertz — Fri, 05 Jan 2024 21:23:55 GMT

Gains and losses within a retirement account are not reportable. Distributions from a retirement account are ordinary income and are not subject to any capital-gains treatment.