villainx Posted October 25, 2023 Posted October 25, 2023 I feel so embarrassed to post this. But can folks share general guidelines on what type of equities (and I guess options) belongs to which trading account amongst taxable, traditional IRA, and Roth IRA? My general assumption is that higher yielding dividend stocks works best in Roth. While no/low dividend works best in traditional and taxable. I’m less certain on what to do with speculative stocks. I am thinking any trading account is okay, with some consideration given to taxable accounts allowing for offsetting capital loss if the bet turns sour, while the IRAs allows shielding from capital gains if speculation works out. This would apply to trading options too. I’m most flummoxed with foreign stocks. And would it be different if it was sponsored ADR (BABA, INFY, GRVY), unsponsored ADR (LMUY), OTC (TOITF, NTDOY, LVMHF), foreign USA listed (MELI, MDT), foreign listed (MC.PA, PSH.AS). And that’s not taking including Canadian stocks (BN, CNSWF, FRFHF). Is there reasons why foreign stocks or certain type of foreign stocks should or shouldn’t go into any particular trading account? I vaguely know of foreign taxation withholding and crediting issues, ADR fees, and such stuff. Though most of the foreign companies I look at don’t really pay much or any dividends (and I don’t itemize my deductions anyway, so it shouldn’t really matter?). Right now, I’ve been restricting most of my foreign stock investing in my taxable brokerage account, mainly for fear of unknowingly making a mistake in holding - for example - CNSWF or MELI in either my traditional or Roth IRA. These feel like such a newbie question, but I've been looking for advice on this for a real long time. Appreciation in advance!
Malmqky Posted October 26, 2023 Posted October 26, 2023 Usually brokerages withhold foreign taxes. I wouldn’t worry too much about it. Anyways, you seem to have a decent handle on it all. Why don’t you meet with your accountant for an hour and get some piece of mind? Should only cost you a few hundred and you’ll have your answers.
Recommended Posts
Create an account or sign in to comment
You need to be a member in order to leave a comment
Create an account
Sign up for a new account in our community. It's easy!
Register a new accountSign in
Already have an account? Sign in here.
Sign In Now