Image via Wikipedia The new limits for retirement plans in 2012 have just recently been published. The details of these new limits are below: IRA The contribution limit (and therefore the deductible contribution limit) for a traditional IRA remains the same in 2012 as in 2011 – at $5,000. The catch up provision, available to taxpayers age 50 or better, also remains the same at $1,000. If you’re a Single filer and covered by a retirement plan via an employer, the deductibility phases out when your Adjusted Gross Income (AGI) is over $58,000 and phases out completely at an AGI of $68,000. This is an increase of $2,000 over the 2011 phase-out range. If you’re Married and filing jointly and the spouse making the IRA contribution is covered by a workplace retirement plan, the phase-out range is between $92,000 and $112,000, also up from 2011 by $2,000. If you’re not […]
ira contribution limits
Roth IRA for Youngsters
Image via Wikipedia Many times it is among the best of ideas to establish a Roth IRA for your child. This way, your child can benefit from the long-term growth in the account and have a very good head start on retirement savings for later in life. There are other benefits, including the fact that retirement funds are not included when financial aid is being calculated for college expenses, as well as providing funds for the child to use when the time comes to buy a house. One thing can cause a real problem though: if you undertake to make contributions to a Roth IRA for your child that aren’t based in fact. What’s that? How can this be? So there’s a way you can make contributions to Roth IRA that aren’t based in fact? What fact is that?? The rules for making contributions to Roth IRAs (actually, any IRA) […]
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NonDeductible IRA Contributions: Good or Bad Idea?
Image by Sean MacEntee via Flickr If you find yourself in the position of having too high of an income to make a deductible contribution to your IRA for the year ($110,000 for joint filers in 2011, $66,000 for Single and Head of Household), you may be wondering if it’s a good idea to make a non-deductible contribution to your IRA. There are two opposing camps on this issue, and the deciding factor is how you’re intending to use the funds in the near term. It’s a Good Idea If you’re intending to convert your IRA to a Roth and your income is too high to just make the contribution directly to the Roth account, the non-deductible IRA may be the right choice for you. This way you’re effectively working around the income limitations of the Roth contribution ($179,000 for joint filers in 2011 or $122,000 for single or head […]
Sterling Raskie, MSFS, CFP®, ChFC®
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