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Subject:  Re: Simple and Roth IRA, compatible? Date:  8/21/1999  9:34 AM
Author:  TMFPixy Number:  13316 of 88036

Greetings, Lukedds, and welcome. You asked:

<<I am in the process of setting up a Simple IRA for my corp. Can I still deposit money into my Roth IRA account along side my Simple IRA deposits?>>

Yes, you may. Your participation in the SIMPLE has no impact on your ability to contribute to a Roth IRA. The only hurdle you have to overcome is the adjusted gross income limit for making that contribution. If your AGI is l$150K or less as a joint filer ($95K or less for a single filer), then you may make a full contribution to a Roth IRA.

A secondary question would be, if you are in the 31% tax bracket would you want the $2,000 to go into the Roth or just take the short term gain of deductibility of the Simple?

I would make a maximum contribution to the SIMPLE and a Roth IRA contribution to get the maximum tax break today plus tax-free distributions from the Roth later.

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