Originally my Roth IRA only contained mutual funds. All my VTSAX shares just said "noncovered shares" and didn't track anything.
I recently converted them to VTI and I just noticed that cost basis for every ETF share suddenly appeared. Is there any reason for tracking cost basis in your Roth IRA or is it completely irrelevant?
Is there any reason for tracking cost basis in a Roth IRA?
Re: Is there any reason for tracking cost basis in a Roth IRA?
So there are certain things you need to track for form 8606 each year (contributions which may loosely correspond to basis depending on how much you rebalance).
I track it because I do like to understand how my investments are performing not on a daily level but just across time and knowing the cost basis helps.
I track it because I do like to understand how my investments are performing not on a daily level but just across time and knowing the cost basis helps.
Re: Is there any reason for tracking cost basis in a Roth IRA?
Cost basis, no. There are no capital gains in an IRA. Any tracking would only be for your information and irrelevant for taxes.
Tax basis from contributions and conversions, yes. That is separate from what you are asking though, just wanted to mention it.
Tax basis from contributions and conversions, yes. That is separate from what you are asking though, just wanted to mention it.
Re: Is there any reason for tracking cost basis in a Roth IRA?
You can withdraw contributions (basis) any time without tax or penalty. The same is not true for earnings. If you want to withdraw before age 59.5 (and/or don't meet the 5 year rules), then you would want to know how much you've contributed.Helium wrote: ↑Tue Jan 25, 2022 4:10 am Originally my Roth IRA only contained mutual funds. All my VTSAX shares just said "noncovered shares" and didn't track anything.
I recently converted them to VTI and I just noticed that cost basis for every ETF share suddenly appeared. Is there any reason for tracking cost basis in your Roth IRA or is it completely irrelevant?