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Retirement & Financial Planning Report Issue: Thurs, March 2, 2006
You can contribute to an IRA for 2005, including a Roth
IRA, up until April 17, 2006. Generally, the deadline is
April 15 but that date falls on a Saturday this year. For
2005, the maximum you can contribute is $4,000 (up from
$3,000 in 2004), plus another $500 if you were at least
50 years old last year.
Often a Roth IRA will be a better choice. With a
traditional IRA, you might not get an upfront deduction.
Full deductions are available only if your income was
under $50,000 in 2005, or under $70,000 on a joint return.
What's more, all of your withdrawals will be fully taxed.
In effect, you'll be sharing any investment success with
the IRS.
With a Roth IRA, there is never an upfront deduction. All
withdrawals are tax-free, five years after you open the
account, as long as you're at least 59-1/2 years old. To
make a full Roth IRA contribution for 2005, your income
can be as much as $95,000, if you're a single filer, or
up to $150,000 on a joint return.
swsop
You can contribute to an IRA for 2005, including a Roth
IRA, up until April 17, 2006. Generally, the deadline is
April 15 but that date falls on a Saturday this year. For
2005, the maximum you can contribute is $4,000 (up from
$3,000 in 2004), plus another $500 if you were at least
50 years old last year.
Often a Roth IRA will be a better choice. With a
traditional IRA, you might not get an upfront deduction.
Full deductions are available only if your income was
under $50,000 in 2005, or under $70,000 on a joint return.
What's more, all of your withdrawals will be fully taxed.
In effect, you'll be sharing any investment success with
the IRS.
With a Roth IRA, there is never an upfront deduction. All
withdrawals are tax-free, five years after you open the
account, as long as you're at least 59-1/2 years old. To
make a full Roth IRA contribution for 2005, your income
can be as much as $95,000, if you're a single filer, or
up to $150,000 on a joint return.
swsop