Roth IRAs

 

Some people find a roth IRA is the best choice. Roth IRAs offer the following advantages:

  • Tax structure - contributions are post-tax, but growth is tax-free. Once you put your money in, following a five-year holding period, you never pay taxes again. Since withdrawals are not reportable income, they won't affect your adjusted gross income during retirement.
  • Flexibility - since you have already paid taxes up front, there are no minimum distribution requirements.

Catch-Up

IRA holders who are 50 or older by the end of the year can contribute an amount in excess of their annual contribution into a roth or traditional IRA as follows:

  • 2012: $1,000.00
  • 2013: $1,000.00


    The above information is provided for educational purposes and is not intended as tax advice. Please consult a tax professional.