IRA’S…. THE LAWS THEY ARE A CHANGIN’
IRAs have always been a great tax-favored way to save for retirement. But over the years, Congress did not adjust the maximum contributions limit to keep pace with inflation. Now, thanks to the Economic Growth and Tax Relief Reconciliation Act of 2001, IRAs are better than ever. This exciting new law:
- Boosts annual contribution limits
- Provides catch up contributions for workers age 50 and over
- Makes it easier to consolidate assets in IRAs and employer-sponsored plans
- Offers a tax credit to low and middle income people who make IRA contributions
Interested in how the new and improved IRA can help you save for the future? Call the credit union today for straightforward answers. We don’t give tax advice therefore if your questions are tax related, please contact a tax professional.
NO MATTER WHERE YOUR ROAD TAKES YOU, A CREDIT UNION IRA CAN PLAY A MAJOR ROLE IN YOUR FINANCIAL SECURITY. COMPARE YOUR IRA OPTIONS:
Anyone under the age of 70 ½ who has income from compensation (or who is filing jointly with a spouse who earns compensation) can contribute to a traditional IRA. Some of the benefits are that many people can deduct contributions on their tax returns, all earnings are tax-deferred, contributions for a first time home purchase are penalty free and taxable contributions of earnings are penalty free for certain higher education expenses, large medical costs and health insurance premiums.
Anyone who has income from compensation (or who is filing jointly with a spouse who earns compensation) with the following modified adjusted gross income: Up to $95,000 (single filers), Up to $150,000 (joint filers) can contribute to a Roth IRA.
Reduced contributions are allowed for higher incomes up to $110,000 for single filers and $160,000 for joint filers. Some of the tax benefits are that contributions are non-deductible but qualified distributions are tax-free and taxable contributions of earnings are penalty free for certain higher education expenses, large medical costs, and health insurance premiums.
CONTACT US ABOUT THE IRA PLAN THAT’S RIGHT FOR YOU.