How much can I contribute to an IRA?
The maximum contribution to either a Traditional or Roth IRA is
or 100% of your earned income, whichever is less. If you are age
50 or over, you are allowed an additional $1,000 "catch-up"
Can I invest in both Traditional and Roth IRAs?
Yes, as long as the total amount of your contributions does not exceed
$5,500 (or $6,500 for age 50 and over). For example, if you were eligible to contribute
$2,500 to a deductible
IRA, you could also contribute $3,000 to a non-deductible IRA or Roth IRA.
What is the deadline for my IRA contributions?
The final deadline for making prior year IRA contributions is April 15.
For example, a contribution for tax year 2015 may be made up until April
Is my spouse eligible for an IRA?
Yes, a non-working
spouse is eligible to open either a Traditional or Roth IRA with a maximum
contribution of $5,500.
Can a minor contribute to an IRA?
As long as the child has earned income, he or she can contribute to a
minor IRA. It can be opened as a Traditional or Roth IRA, and the maximum
contribution is $5,500 or 100% of earned income, whichever is less. To establish
a minor IRA, the account must be opened and held by an adult, as guardian,
in the name of the minor. While the adult is the individual authorized to
perform transactions on the account, the minor is considered the registered
owner for tax purposes.
If I'm self-employed, what other retirement saving options do I
If you are self-employed or own a small business, other options you may
have include contributing to a Simplified Employee Pension IRA (SEP-IRA)
or SIMPLE plan.
When can I take funds out of my IRA?
Distributions from a Traditional IRA can be made penalty-free at
59½, and minimum
required distributions begin the year you turn 70½. You
can also take withdrawals from a Roth IRA once you are 59½,
as long as the account has been in existence for at least five years.
Unlike Traditional IRAs, there are no required distributions.
In most instances, if withdrawals
are made before age 59½, there is a 10% early distribution
penalty. However, there are situations where funds can be taken
from an IRA without tax or penalty. You can withdraw funds from
any IRA penalty-free to pay for a first-time home purchase or higher
If the funds withdrawn from a Roth IRA are used for a
first time home purchase, and the account has been open for at least
five years, the withdrawal will also be tax-free. Certain exceptions
also exist for circumstances involving death, disability, and medical
If I take a distribution from my IRA, can I replace it without being
Once a distribution is taken from an IRA, you have sixty days from the
time you receive the check to replace those funds and avoid any associated
penalties or taxes. This type of rollover can be done only once every 365