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Greetings, YellowHammer, and welcome.

<<Question 1: is it legal to have multiple IRAs so long as you only contribute a total of $2K to them collectively per year?>>

Absolutely. It makes no difference if you have 2000 IRA and contribute $1 to each or just one IRA to which you contribute $2K. The controlling factor is the maximum annual contribution of $2K. That's the collective limit you may contribute to all IRA whether that contribution is fully deductible, partially deductible, or totally nondeductible in the year it is made.

<<Question 2: Assume I have an existing IRA and a 401(k). If I leave my company, can I rollover the 401(k) money into the existing IRA? If so, would this count toward my $2K yearly contribution?>>

When you leave your job, you may indeed transfer your 401k monies to an IRA without penalties or taxes. To avoid potential tax problems, if you want to do that you should see your benefits administrator to discuss the procedures for arranging a custodian-to-custodian transfer so you never touch the money. However, if you transfer the 401k money to an existing IRA, you will lose all eligibility to later transfer that sum and all its earnings to a future employer's 401k plan. Thus, you may want to read prior posts in this folder on this issue to obtain further information. A good start is to read those messages under the thread "How Does 401k Work?".

<<Final question: I know I can convert some or all of an existing standard IRA into a Roth IRA (paying the taxes, of course), but is it a one shot opportunity, or could I convert part now and part next year, and the rest later?>>

You can't do anything until at least January 1, 1998. That's the first date anyone may use a Roth IRA. But after that date you may roll all or part of existing IRA to the Roth, and you may do so in any and every year the Roth IRA option is available. Do so in 1998, and you must declare one-fourth of the amount rolled as income and pay taxes on that in each year from 1998 through 2001. Roll regular IRA monies to a Roth in 1999 or later, and you must claim the entire amount as income and pay taxes on that sum in the year it was rolled.

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