No. of Recommendations: 1
Current regular non deductible IRA.
Contributed $2000 to this in Y2K.
Wife has no IRA
Meet income standards for Roth

JAFO has already explained contribution limits to you. I want to talk abuot that nondeductible contribution to your traditional IRA for year 2000.

One of the few no-brainers in tax law is the choice between a nondeductible traditional IRA contribution and a Roth contribution, assuming you meet the Roth AGI limit. The Roth is the clear choice. Neither contribution is deductible, but with the Roth you never pay tax on the earnings. With the traditional, you pay tax on the earnings when you withdraw them.

You can fix your year 2000 contribution mistake. Contact your custodian for the paperwork to "recharacterize" your year 2000 contribution as a Roth contribution. You can do this any time before 10/15/2001, and it's to your advantage to do so.

Phil Marti
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