On Wed, 11 Apr 2007 14:49:28 -0500, Ernie Klein <ecklein[at]pacbell.netwrote:

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or not of dividends and interest has no tax consequences. The tax
consequences occur when money is withdrawn.

However, one nuance that does matter is net unrealized appreciation in
company stock in your 401K which does receive special tax treatment
when rolled over or withdrawn. See for example
http://www.investopedia.com/articles.../05/062305.asp
among many articles that can be found on this subject. Note that
often your company 401K policy may prohibit repurchasing company stock
if you once sell that stock.

One statistic you might ask about your 401K if you hold company stock
is what is the NUA amount on that stock as distinct from "unrealized
appreciation" in one fund or another.

Ernie Klein <ecklein[at]pacbell.net> writes:

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That's certainly correct and true.

However, many brokers/custodians I have come across will, for
tax-deferred accounts, list economic gains as "gains" or
"unrealized gains" -- ignoring reinvested dividends. In
a way that's correct -- if you put in $10,000 and it's
worth $35,000, you really do have a $25,000 economic gain.
It's calling it "unrealized gain" which is a specific term
that really only has full meaning in the world of taxable
accounts that's the problem.

--
Rich Carreiro rlcarr[at]animato.arlington.ma.us

In article <m3veg2u7my.fsf[at]animato.home.lan> ,
Rich Carreiro <rlcarr[at]animato.arlington.ma.us> wrote:

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I believe that if you have also been reinvesting all dividends and
capital gains in the fund that those become realized gains, therefore
using your numbers; if you buy a fund for $10,000 and reinvest $2000 of
dividends and long/short capital gains, and at the end of the year the
fund is worth $25,000, you end up with $13,000 unrealized gain i.e., had
you not reinvested but had taken the dividends and cap gains in cash
instead, you would end up with a fund worth ~$13,000 and have $2000 cash
(a realized gain).

But as someone said: in a tax deferred account, like a 401K, it doesn't
really matter what you call it, because it doesn't matter one way or the
other until you sell the fund.

--
-Ernie-

On Apr 11, 11:36 am, "MaryL" <m...[at]l.jp> wrote:
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Or until they distribute it to you. But either way it's not a taxable
event since it's in the 401K.


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Isn't that wonderful?

"MaryL" <mary[at]l.jp> writes:

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All it means is that at the moment the statement was prepared, your
investments in the account were worth $25,000 more than you paid
for them. That's it. The market could crash tomorrow and they
could suddenly be worth less than you paid for them. Or they
could keep going up. But the key part is that $25,000 gain
is not and will never be guaranteed, booked, or posted in any way
(unless you sell and thereby convert the paper gain to cash).

--
Rich Carreiro rlcarr[at]animato.arlington.ma.us

On Apr 11, 10:12 am, "MaryL" <m...[at]l.jp> wrote:
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At no time does the fund book the gain/loss until you sell the fund,
or when the gains are distributed to you (most likely annually).

In a taxable account, it allows the fund holder to do some tax
planning in anticipation of a fund distribution.

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Not really, since it's in a 401K account, it shouldn't have any tax
consequences.


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wyu wrote:
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so since I *never* do move or sell anything but have stayed in the mix of
funds since I joined the 401k plan, it means literally nothing? 25k a year
is a big deal and I just now noticed it on the last online statement so am
wondering at what point it's actually booked?

I don't actually get a statement, mailed, it's all online only and I access
the account only online
somehow the 401k has also continued to grow over the decades....have had
same plan, same funds since 1979

"MaryL" <mary[at]l.jp> writes:

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If they're using the term the same way as it would be
used in a taxable account, it means the price appreciation
in the fund since you purchased it.

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Never. Well, not until you sell.

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It never gets "posted" absent you selling them.

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It doesn't "post". If you buy $10,000 of Fund XYZ in
your 401(k), and a year later your XYZ holding is
worth $25,000, you have a $15,000 unrealized gain.
But it could easily shrink/disappear if Fund XYZ drops
in price. The only way to "post" it is to sell XYZ.

--
Rich Carreiro rlcarr[at]animato.arlington.ma.us

On Apr 11, 10:12 am, "MaryL" <m...[at]l.jp> wrote:
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For a 401K -- or any other tax-deferred account -- gains are only
realized when you sell and move the money to something else. Your
statement showing unrealized gains is probably just an artifact of the
fund company's standard template sent to investors in both taxable and
tax-deferred accounts. It really has little relevance in your case.

hello,

as the subject line asks, what is an unrealized gain/loss in a 401k "balance
history" statement (1 year)?
I understand what it means otherwise but as the 401k balance continues to
climb, month over month, at what point does the fund/funds actually book the
gain/loss?

does understanding this timeframe allow me some maneuvering as to moving
money between funds? or does it limit me in such a way that I should not do
it until the gain is posted?

am looking right now at one fund, where the 12 month balance history shows
me having an unrealized gain of 25k and wondering when it actually posts?