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Author: intercst Big funky green star, 20000 posts Top Favorite Fools Top Recommended Fools Feste Award Nominee! Old School Fool Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: of 74759  
Subject: Re: Non-deductible IRAs Date: 1/21/2000 10:43 AM
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PixelFool asks,

I saw the following statement on the "Ten Types of IRAs" section of the tutorial on IRAs:

"There are also non-deductible IRAs (if your income is over a certain limit, and you are a participant in a qualified pension/profit sharing/retirement plan). "

I couldn't find any more in the tutorial about these
types of IRAs. Does anyone know what this statement
is talking about, and where I can find out more
information about this?

I'm looking for an investment vehicle that:

1) I can put a LARGE chunk of cash into at once;
2) I can invest in individual stocks;
3) Growth is tax-deferred; and
4) It's OK if it's "locked in" until some
age like 59 1/2 or something like that.

The above statement seemed like what I needed
but I couldn't find out any more about it...

Thanks!



You can only put $2,000/yr. ($4,000/yr. if you're married) into a "non-deductible IRA." This may or may not meet your deinition of a "LARGE chunk of cash."

If you are a long-term buy & hold (LTB&H) investor you can satisfy the 4 criteria you list with a taxable account and enjoy the advantage of paying the maximum 20% capital gains tax on any stock appreciation. However, a taxable account won't be helpful if you do much trading.

intercst
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