Hi, I would be very grateful if anyone can give me some pointers on this question.
I am about to retire from government employment and will be able to convert the funds in my deferred compensation (pretax) fund to a self- directed IRA. Any distributions will, of course, be taxable.
At the same time, I have also been subject to foreclosure on a mortgage on rental property I have owned since 2004. I will have a deductible Net Operating Loss that will exceed the amount in my deferred comp fund. (Bank is pursing a Deficiency Judgment, so no 1099 form.)
Normally the Net Operating Loss would enable one to get refunds for taxes paid in the last three years, and then go forward to future years if any credit remains.
Can I offset the taxes owed on the Roth conversion against the credit incurred by the Net Operating Loss either this year or in a future year, or does this all have to be done in separate steps?
I would welcome any comments.