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Contribute stock to IRA?

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in Small Business Tax,Small Business Tax Deduction Strategies

Q: I recently acquired stock in a closely held company. Can I contribute the stock to my IRA? P.A., Hermosa Beach, Calif.

A: Tax law clearly says that contributions to an IRA must be made in cash (IRC 219(e)(1)). It doesn't matter whether the stock is publicly traded or not. Of course, you have the option to sell the stock and contribute part or all of the proceeds to the IRA (up to $3,000 or 100 percent of earned income, whichever is lower), but you must then recognize a gain or loss for tax purposes.

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