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Author: ffearless Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: of 75832  
Subject: Maximum investments in IRA's Date: 10/26/1999 7:35 AM
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Very, very, very new to the sport of retirement and it's many approaches.

i want to start an (or more than one) IRA(s). My wife has a 401k from her business and we are not eligible for the Roth IRA, nor or we eligible to make deductible contributions to an IRA.

Are IRA's still an option for us?

Can we contribute more than $2,000 to an IRA?

Is the $2000 contribution just for one IRA or is it a cummulative contribution among more than one IRA?


I have read the FAQ's and read the Fool's School on IRA's, but cannot seem to find the answers to my questions. Would really appreciate your responses.

Thank you all in advance.
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Author: pauleckler Big funky green star, 20000 posts Top Favorite Fools Old School Fool Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: 14793 of 75832
Subject: Re: Maximum investments in IRA's Date: 10/26/1999 9:52 AM
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You and your wife should each have IRA accounts. Each individual may contribute a total of $2K/yr to all their IRA accounts combined. So no, you cannot increase your contributions by opening multiple accounts.

Yes, you should make non-deductible contributions to your IRA accounts. The earnings on the money are protected from taxes when earned. This allows your investments to grow faster.

It is in your best interest to max contributions to both your 401K plans and your IRAs. Beyond that developing a taxable investment program is next most important. As noted in the previous message, proper selection of investments can minimize the tax burden. Long term buy and hold stocks or tax managed mutual fund (or index fund) are usually recommended.

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Author: gofsguy Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: 14822 of 75832
Subject: Re: Maximum investments in IRA's Date: 10/27/1999 12:22 AM
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Paulecker is right on here. Unfortunately you can not gain the immediate tax advantage, but should put your money here anyway. Also, the two of you are allowed to put $4000 in jointly. As a sidebar, the Tax Bill that was vetoed by the president had changes to at least the Roth contribution amounts, raising the contribution limits over a number of years. I am not positive, but I believe that this included traditional IRAs as well. Keep your eyes peeled, and no matter your political persuasion, we should all root for this in the future. With Social Security becoming less dependable I think you will see changes in the personal finance realm that will be beneficial to us all. Good Luck!

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Author: sharyncern Two stars, 250 posts Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: 15583 of 75832
Subject: Re: Maximum investments in IRA's Date: 11/22/1999 12:20 PM
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Yes, you should make non-deductible contributions to your IRA accounts. The earnings on the money are protected from taxes when earned. This allows your investments to grow faster.

Can I make non-deductible contributions to existing traditional IRA accounts?

My husand and I are self-employed in a Subchapter S corporation owned by us. We have traditional IRAs from the past, and this year the company set up a SEP IRA for each of us, which it has funded to the full percentage it is allowed. Can we:

(1) make contributions of our own to these SEP IRAs? Before taxes? After taxes, but income deferred?

(2) make additional contributions to our existing traditional IRAs? Tax deductible?

(3) open Roth IRAs and contribute to them?

(4) any combination or all of the above?

Sharyn

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Author: TMFPixy Big gold star, 5000 posts Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: 15589 of 75832
Subject: Re: Maximum investments in IRA's Date: 11/22/1999 1:50 PM
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Greetings, Sharyn, and welcome. You asked:

<<Can I make non-deductible contributions to existing traditional IRA accounts?

My husand and I are self-employed in a Subchapter S corporation owned by us. We have traditional IRAs from the past, and this year the company set up a SEP IRA for each of us, which it has funded to the full percentage it is allowed. Can we:

(1) make contributions of our own to these SEP IRAs? Before taxes? After taxes, but income deferred?

(2) make additional contributions to our existing traditional IRAs? Tax deductible?

(3) open Roth IRAs and contribute to them?

(4) any combination or all of the above?>>


For details, see our IRA area at http://www.fool.com/Money/AllAboutIRAs/AllAboutIRAs.htm. You may make contributions to a traditional IRA at any time as long as you have the earned income to do so and are under the age of 70 1/2. The only question is whether you may deduct those contributions. As a participant in a SEP, your joint adjusted gross income (AGI) must be less than $51K to have a fully deductible contribution this year. Still, you may always make a nondeductible contribution. If the latter is all you can do, then a Roth IRA is almost certainly the route to go (assuming you meet AGI limits for doing so) so you can take the earnings tax-free in retirement. If you are contributing to a traditional IRA, then you may use the SEP for that purpose. Also, you may contribute to both a traditional and a Roth in the same year provided your contributions in any combination to each does not exceed $2K.

Again, for details see our IRA area.

Regards..Pixy

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Author: Chrisy69 Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: 17330 of 75832
Subject: Re: Maximum investments in IRA's Date: 1/4/2000 2:17 PM
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Hello Pixy, I was hoping you could give me further clairification on a reply to a post you made regarding non deductible IRA contibutions. I browsed TMF IRA area, but was unable to find much guidance regarding making nondeductible contributions. You wrote:

You may make contributions to a traditional IRA at any time as long as you have the earned income to do so and are under the age of 70 1/2. The only question is whether you may deduct those contributions. ...Still, you may always make a nondeductible contribution. If the latter is all you can do, then a Roth IRA is almost certainly the route to go (assuming you meet AGI limits for doing so) so you can take the earnings tax-free in retirement.

Again, for details see our IRA area.

Regards..Pixy


I would like to know to what extent I can make a nondeductible contribution to an IRA. My stats are as follows:
1) I have earned income and my AGI exceeds the Roth IRA AGI limits, so a Roth IRA is out.
2) I contribute the max to my 401K at work
3) I am 38 years old, single

Can I open and make nondeductible contributions to an IRA given the above? Can they be in excess of $2000? Is there a ceiling on the size of the nondeductible contribution I can make? Is there no penalty for doing so given my situation? Any help would greatly appreciated

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Author: TMFPixy Big gold star, 5000 posts Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: 17332 of 75832
Subject: Re: Maximum investments in IRA's Date: 1/4/2000 2:54 PM
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Greetings, Chrisy69, and welcome. You asked:

<<Can I open and make nondeductible contributions to an IRA given the above?>>

Yes, you may, but to a nondeductible traditional IRA only.

<< Can they be in excess of $2000?>>

No, your annual contribution may not exceed a maximum of $2K.

<< Is there a ceiling on the size of the nondeductible contribution I can make?>>

Yes, it cannot exceed a maximum of $2K per year.

<< Is there no penalty for doing so given my situation?>>

Other than the fact you don't get a tax deduction on the contribution and the fact that your AGI exceeds the limit for a contribution to a Roth IRA, there is no penalty if you use the nondeductible traditional IRA.

Regards..Pixy

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