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Understanding Roth IRA Accounts


Regardless of your age, you may be able to establish and make nondeductible contributions to an individual retirement plan called a Roth IRA.

What is a Roth IRA?
A Roth IRA is an individual retirement plan that is subject to the rules that apply to a Traditional IRA. It can be either an account or an annuity.
To be a Roth IRA, the account or annuity must be designated as a Roth IRA when it is opened.
Unlike a Traditional IRA, you can’t deduct contributions to a Roth IRA. But, if you satisfy the requirements, qualified distributions are tax free, and if you choose, you can leave amounts in your Roth IRA as long as you live.
When can a Roth IRA be opened?
You can open a Roth IRA at any time. However, the time for making contributions for any year is limited.
Can you contribute to a Roth IRA?
Generally, you can contribute to a Roth IRA if you have taxable compensation, and your modified adjusted gross income is less than:
  • $208,000 for married filing jointly or qualifying widow(er)
  • $140,000 for single, head of household, or married filing separately and you didn’t live with your spouse at any time during the year
  • $10,000 for married filing separately and you lived with your spouse at any time during the year
How much can be contributed?
The contribution limit for Roth IRAs generally depends on whether contributions are made only to Roth IRAs or to both traditional IRAs and Roth IRAs.
When can you make contributions?
You can make contributions to a Roth IRA for a year at any time during the year or by the due date of your return for that year (not including extensions).
APCI FCU can assist you with your retirement planning and offers solutions for your everyday banking needs. Please contact Al Kauffman, Certified IRA Professional, at 800-821-5104, ext. 2840 for more information.
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