Sorry but you don't get to claim capital gains on retirement distributions, they are entirely taxed as ordinary income. If your tax rate later will be 40%, you

Sorry but you don't get to claim capital gains on retirement distributions, they are entirely taxed as ordinary income. If your tax rate later will be 40%, you get the exact same result: 3000-1200=1800. If your tax rate will be lower in retirement, favor pre-tax contributions. If higher, favor after-tax. The trick is knowing what tax rates will be years (decades?) from now.