When Are you Allowed to Make a Contribution to a Traditional IRA?

September 5th, 2017

Contributions can be made to your traditional IRA for a year at any time during the year or by the due date for filing your tax return for that year, not including extensions. For most people, this means that contributions for 2017 must be made by April 17, 2018, and contributions for 2018 must be […]

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What Happens When You Use Your IRA in a Prohibited Transaction?

May 30th, 2017

The Internal Revenue Code does not describe what a Self Directed IRA can invest in, only what it cannot invest in. Internal Revenue Code Sections 408 & 4975 prohibits Disqualified Persons from engaging in certain type of transactions. The purpose of these rules is to encourage the use of IRAs for accumulation of retirement savings […]

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What Reporting Requirements Exist for Traditional IRA holders?

January 4th, 2017

Individuals maintaining IRAs and surviving beneficiaries under IRAs must usually file an annual information return on Form 5329. Also, an individual maintaining an IRA must make an information filing for each year in which a nondeductible IRA contribution is made or a distribution is received from an IRA. The filing, which must be included with […]

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What Are the Minimum Distribution Requirements of a Traditional IRA?

December 10th, 2016

The terms of an independent retirement account or annuity must include several minimum distribution rules, which Congress imposed to ensure that IRAs are primarily used as retirement savings media, not as vehicles to build wealth for transmission to heirs. As discussed below, these rules provide separately for distributions to IRA owners and distributions to beneficiaries […]

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Are You Allowed to Rollover a Traditional IRA to a Roth IRA?

March 23rd, 2016

Starting in 2011, everyone qualifies to convert to a Roth IRA. As with any rollover, you will want to arrange a direct rollover from the plan to the Roth IRA to avoid mandatory income tax withholding and not worry about the 60-day window which the transfer must be completed.  (See Below) Do I pay tax […]

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Deciding Between a Traditional and Roth IRA

February 4th, 2016

There’s no right or wrong answer. The decision usually depends on a variety of factors and circumstances. If you are not eligible to take advantage of tax-deductible contributions to a traditional IRA but qualify for after-tax contributions to a Roth IRA, then the Roth IRA is the better choice. Roth IRA contributions are made in […]

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The Difference Between an IRA and a Self-Directed IRA with Checkbook Control

October 29th, 2015

An Individual Retirement Account (IRA) is a tax-deferred retirement account for an individual that permits individuals to set aside money each year, with earnings tax-deferred until withdrawals begin at age 59 1/2 or later (or earlier, with a 10% penalty). Many “traditional IRA” custodians advertise themselves as offering a Self Directed IRA with “checkbook control”, […]

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Should You Convert Your Traditional IRA to a Roth IRA?

September 4th, 2015

The consensus view is that the conversion route should be considered by taxpayers who: have a number of years to go before retirement (and are therefore able to recoup the dollars that are lost to taxes on account of the conversion); anticipate being taxed in a higher bracket in the future than they are now; […]

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