Taxes are paid prior to depositing into a Roth IRA. So, what additional taxes would you expect to be paid if there were no Roth IRA involved? Taxes were already paid.
Yes, capital gains taxes would be paid without a Roth IRA. Similarly, if the funds will be used prior to 59 1/2 from within a Roth IRA, then capital gains will still be paid. If there is an early withdrawl, then there is an additional tax penalty. An IRA protects the owner from capital gains, because the funds aren't being used.
I think the point is that the Roth IRA was used in the exact way it was designed and how anyone can use one.
Comments
Taxes are paid prior to depositing into a Roth IRA. So, what additional taxes would you expect to be paid if there were no Roth IRA involved? Taxes were already paid.
I doubt that $5B didn't get there without any growth after taxes were paid. If there were no Roth IRA, any capital gains would be taxed.
Yes, capital gains taxes would be paid without a Roth IRA. Similarly, if the funds will be used prior to 59 1/2 from within a Roth IRA, then capital gains will still be paid. If there is an early withdrawl, then there is an additional tax penalty. An IRA protects the owner from capital gains, because the funds aren't being used.
I think the point is that the Roth IRA was used in the exact way it was designed and how anyone can use one.
Usually capital gains taxes would apply.
In this case the difference between FMV and strike was $0 so no taxes were actually paid at all.