Go to Jeff Salisbury LWGate Home Page.From: Rich Carreiro <rlcarr@animato.pn.com>
Subject: Re: Mass treatment of Roth Conversion
Date: Mon, 22 Jun 1998 19:48:55 -0400
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><I don't know how you can say that about a state that has a 12% tax on >unearned income.> > >My understanding is in Mass an IRA distributions is considered 5.95% >income not 12% income. True. However, that was in the context of talking about how unfair the MA tax rate on dividends and interest is. I had also mentioned how I had read in more than one article that earnings inside of *Roth* IRAs will be taxed at 12% regardless of whether they are long-term cap gains or not. I admit such a statement puzzles me but I have seen it in more than one place. Of course (hopefully :-) it'll be moot quite soon, since the tax cut packages passed by the MA House and MA Senate (a conference committee is currently thrashing out a reconciled bill) both will follow the federal treatment of Roths. >distribution reduces Cost Basis first, and the Cost Basis includes all >IRA contributions, whether deductiable or not on Federal Return. Mass Here I disagree slightly. I believe that the MA cost basis in a traditional IRA only includes contributions made while one is an MA taxpayer (deductible or not), not all contributions. At least this is what I remember the Form 1, Sched X instructions saying. Rich Carreiro rlcarr@animato.pn.com P5-100/RedHat Linux 4.1 - -
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