Traditional IRA


A traditional IRA is a tax-deferred account designed specifically for retirement savings. Anyone under the age of 70 1/2 who has earned income may establish and contribute up to $5,000, ($6,000 if age 50 or older) annually to an IRA.

Plan features

  • Contributions may or may not be income tax deductible.
  • All earnings are tax deferred until withdrawn.
  • IRAs decrease reliance on Social Security and pension programs as retirement income sources.
  • There are expectations to enhance and strengthen IRA opportunities in future years.

Eligibility

  • Must be less than 70 1/2 on the last day of the year in which the contribution is taken.
  • Must earn income for services rendered as an employee or as self-employed.

Contribution limits

  • The lesser of 100% of income or $5,000.
  • If age 50 or older, individuals may contribute an additional $1,000 as a catch-up provision.

Deadlines

  • Individuals may contribute to an IRA up until April 15.
  • Distributions must start by April 1 the year after the individual reaches 70 1/2.

Federal taxation of distributions

  • Made after 59 1/2.
  • Made after the owners death.
  • Due to complete and permanent disability.
  • Part of a series of similar equal payments in a manner approved by the IRS.
  • For particular medical expenses.
  • For particular health insurance premiums.
  • For payment of higher education expenses.
  • For purchase of first-time home buyer expenses approved by IRS.

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The employees of Warren Wealth Management do not provide tax or legal advice. As with all matters of a tax or legal nature, you should consult with your tax or legal counsel for advice.

Investment Types

For Individuals:


529 Plans
Annuities
Coverdell ESA
Life Insurance
Roth IRA
Traditional IRA

For Businesses:


401(k) Plans
403(b) Plans
457(b) Plans
Money Purchase Plans
Profit Sharing
SEP IRA
SIMPLE IRA