IRA Retirement

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Early Withdrawl

There is no additional 10% tax on early withdrawals up to $10,000 in your lifetime from an IRA if you are buying a first home for yourself, your children, or your grandchidren. There is also no additional 10% tax if you are paying higher education expenses for yourself, your spouse, your child, or your granchild.

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Contributions

You can contribute up to $5,500 to your IRA (or $5,500 to your spouse's IRA if married filing jointly). Each taxpayer age 50 or older is eligible to make an additional $1,000 "catch-up contribution".

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Rollover

The IRS may waive the 60-day requirement for rollovers from pensions or IRAs if you suffer a casualty, disaster, or other event beyond your reasonable control that prevents meeting the 60-day rule.

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Retirement Saving Contribution Credit

There is a credit for a percentage (50%, 20%, or 10%) of up to $2,000 of the contributions you make to your employer sponsored pension plan or your IRAs. In order to claim the credit; you must be at least 18, you cannot be a more than a half-time student or claimed as a dependent on another's return. Any distribution from a retirement plan in the last two tax years, the current tax year, or any day up until the due date of the current year’s return will reduce the amount available for the credit.  This is one of the few areas in the tax code where you can claim both a credit and a deduction on the same monies.

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Roth 401(k)

If you are eligible to participate in a 401(k) or 403(b) plan through your employer you may designate a portion of our elective deferral to be treated as a Roth contribution. These contributions will be treated as regular income on Form W-2. Distributions from these accounts will be tax-free under the same provisions as a Roth IRA.

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Roth IRA

You can elect to contribute up to $5,500 to a Roth IRA. If you are age 50 or older, there is an additional "catch-up" contribution allowable of $1,000. The Roth IRA differs from the traditional IRA because contributions are not deductible but, when withdrawn, the earnings are not taxable.

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