Retirement Savings Accounts

Have you made your IRA contribution yet this year? Here are three reasons to make your contribution today:

1. TAX DEDUCTION. Unless you or your spouse is covered by an employer plan or your adjusted gross income exceeds annual limits, you may be able to deduct Traditional IRA contributions from your taxes.* For example, if you contribute $5,000 to your IRA you could be able to decrease your taxable income by $5,000. For an investor in the 25% income tax bracket you would save $1,250 on your annual federal income taxes.
2. CATCH UP ADJUSTMENT. If you are close to retirement and think it is too late to benefit from an IRA, take another look. Having only a few years of tax advantages can still make a difference. If you do not need to access your IRA money immediately, you may be able to let it grow for use later on. If you are age 50 or older, you can invest an additional $1,000 in 2012 as a catch-up contribution.
3. TAX-ADVANTAGED CHOICES. In a Traditional IRA, your investments grow tax-free until you take distributions. Distributions both of principal and income are taxed when withdrawn. In a Roth IRA, contributions are not tax deductible. However when certain requirements are met, withdrawals — even before retirement — are tax-free.

Traditional IRA Contributions Deadlines and limits

Roth IRA Contribution Deadlines and limits