IRA BASICS
What is the purpose of an IRA?
Save for retirement - tax advantaged growth
What is the Traditional IRA contribution limit for the 2023 tax year?
$6500, $7500 if you are over 50
What is the Roth IRA contribution limit for the 2023 tax year?
$6500, $7500 if you are over 50
How many account owners can you have for an IRA?
1
Which type of IRA account, roth or traditional, has income limits?
Roth
For 2023
Individual Limit - 153,000
Filing Joint - 228,000
What are the tax implications of traditional IRA contributions?
Tax deduction / lower your taxable income
What is the tax benefit of a Roth IRA?
Tax free growth and withdrawals, at 59.5
How much can you contribute to an IRA if you lose your job?
$0
What is the penalty for early withdrawals from an IRA?
10%
How many old 401k accounts can you rollover into an IRA?
No limit!!
If you have earned income, at what age can you start contributing to a Roth IRA?
Trick question! Any age.
What is an in-service rollover?
Moving assets out of an employer sponsored plan into an IRA, most plans allow this at 59.5
What is a fundamental difference between an IRA and a 401k?
A 401k is an employer sponsored retirement account. An IRA can be opened by anyone with earned income.
At what age do you have to begin taking RMDs (required minimum distribution)?
73
What is a benefit of contributing to a Roth 401k?
No income limits, tax free growth and withdrawals
What factor determines your RMD (required minimum distribution?
Age
What is an example of a type of retirement account that a small business owner or someone who is self employed can utilize.
SIMPLE IRA, SEP IRA
What is a benefit of rolling an old 401k into an IRA?
More diversification
How many years do you need to have a Roth IRA established for before you can withdraw from it.
5 years
How many years do you have to draw down an inherited/beneficiary IRA?
10 years