I have a company sponsored savings investment plan (401k) in which I contribute 6% of my pretax income and they match it up to 6%. I want to start a Fool Dripfolio and was wondering if i could/should start an IRA for this. Can I? Thanks, Kohl
[[I have a company sponsored savings investment plan (401k) in which I contribute 6% of my pretax income and they match it up to 6%. I want to start a Fool Dripfolio and was wondering if i could/should start an IRA for this. Can I?]]You can certainly CONTRIBUTE to an IRA account. The big question will be is that contribution deductible or not. And that will depend upon your adjusted gross income. if you are a single person (for 1997), and your AGI is greater than $35k, your contribution will be completely non-deductible since you are a participant in a qualified deferred compensation plan. The AGI limitation for a married couple is $50k for 1997. Check out IRS Publication 590 for additional information on IRA contributions and how to compute your deduction. If you find that your only option is a non-deductible IRA or a Roth IRA contribution for 1998, you might really consider the Roth IRA contribution for 1998. The reasoning behind this has been explained in many prior posts. You might want to take the time to check them out.TMF TaxesRoySPECIAL NOTE: I try to answer as many questions as I can each week, and I generally select those that have not been asked before. If you don't get a detailed answer to your question, it is probably because my time is so limited during tax season, or because it has already been asked and answered in this folder in the past, or because it has been discussed in the Taxes Frequently Asked Questions area. In order to visit the Taxes FAQ area, go to the Fool's School area (http://www.fool.com/school.htm) and check out "Other Features" in the list box, OR you can jump directly to the Taxes FAQ area (http://www.fool.com/school/taxes/taxes.htm). Additionally, if any references were made to the IRS Web Site, you can get there by pointing your web browser to (http://www.irs.ustreas.gov)
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