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Author: jm010e Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: of 75335  
Subject: Roth IRA Question Date: 12/23/1998 10:11 PM
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I am 21, still in college but i'd like to open up a roth ira. I know there are limitations regarding how much i can put in (i have less than $2000 earned income for 1998 but more than $2000 when i include capital gains, interest, etc...). Am I allowed to open up an IRA? If so, what is the limit? And what year's limit do i use? Do I use 1998 data even though it hasn't been filed yet? Or do I use 1997? Any help would be greatly appreciated.

Thanks
JMittler
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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: 7476 of 75335
Subject: Re: Roth IRA Question Date: 12/24/1998 10:51 AM
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Greetings, Jmittler, and welcome. You asked:

<<I am 21, still in college but i'd like to open up a roth ira. I know there are limitations regarding how much i can put in (i have less than $2000 earned income for 1998 but more than $2000 when i include capital gains, interest, etc...). Am I allowed to open up an IRA? If so, what is the limit? And what year's limit do i use? Do I use 1998 data even though it hasn't been filed yet? Or do I use 1997? Any help would be greatly appreciated.>>

Yes, you can open an IRA. Your contribution cannot exceed the lesser of $2K or your total earned compensation (i.e., job income) fir the year. Capital gains and interest are not counted as earned compensation, so in your case the maximum you may contribute for 1998 is the total of your earned income. Contributions are made for the tax-year in which the compensation was earned. Thus, yours will be for tax-year 1998. You have until the due date of your tax return (4/15/99 for most folks) to make it. See IRS Publication 590, Individual Retirement Arrangements, for details. You can download that publication at www.irs.gov .

Regards….Pixy


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