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Roth
IRA
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| Roth
IRA accounts give the retirement saver the ability to completely
eliminate federal taxes on their investment earnings. Once you
have had the Roth IRA account for five years, withdrawals are
free from Federal Taxes that are made after age
59 ½, on or after your disability or death, or for your first
time home purchase ($10,000 limit). |
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| Like
a traditional IRA, you can contribute up to $4,000 annually
($5,000 if age 50 or older) to a Roth IA, if you have earned
income. Contributions to a Roth IRA, however, are not tax deductible.
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addition, the 10% early withdrawal penalty is waived for the following situations. |
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Because you are 59 ½ or older
- Because
you became disabled or died
- Used
to pay for medical expenses in excess of 7.5% of your adjusted
gross income
- Used
to pay for health insurance premiums after you've been receiving
unemployment compensation for a certain period of time
- Taken
in a series of substantially equal periodic payments
- Used
for higher education expenses
- Used
for a first-time home purchase (up to $10,000)
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| One of the other benefits of the Roth IRA account is that there is
No Age Limit. Contributions can continue even after the regular IRA limit of age 70 ½ as long as you have at least $4,000 in earned income. Once you decide to take your distribution, it is all Federal Income Tax Free. |
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For 2006-2007 the full $4,000 ($5,000 if age 50 or older) Roth IRA contribution may be made by single
taxpayers with modified gross incomes of less than $94,999 and married individuals filing jointly with incomes below $149,999. CLICK
HERE for more detailed information on Roth IRA Accounts. |
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The information contained is
derived from sources believed to be accurate, however we do not
guarantee its accuracy. The information contained is for
general use and it is not intended to cover all aspects of a
particular matter. You should discuss any legal, tax, or
financial matters with the appropriate professional. The
opinions stated are that of the author and not that of The
Investment Center, Inc. |
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ALL SECURITIES OFFERED THROUGH THE INVESTMENT CENTER, INC., Bridgewater, NJ Member NASD - SIPC
- A REGISTERED INVESTMENT ADVISOR LICENSED IN THE FOLLOWING STATES: CA, CO,
CT, FL, GA, LA, MD, MI, NJ, NM, NY, PA, TX, VA
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