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Roth IRA
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Traditional IRA
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Benefits
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Tax-free growth – Tax-free qualified withdrawals
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Tax-deferred growth – Contributions may be tax-deductible based on on Annual Gross Income and participation in an employer-sponsored retirement plan
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Eligibility: Age
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Any age with employment compensation
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Under age 70½ with employment compensation
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Eligibility: Income
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2022:
Single: Up to $129,000
Married filing jointly: Up to $204,000
Married filing separately: $0.
2021:
Single: Up to $125,000
Married filing jointly: Up to $198,000
Married filing separately: $0.
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No income limits to make contributions
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Taxation at Withdrawal
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Contributions are always withdrawn tax-free. Earnings are federally tax-free after the five-year aging requirement has been satisfied and certain conditions are met
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Withdrawals of pre-tax contributions and any earnings are taxable when distributed
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Penalties at Withdrawal
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A non-qualified distribution is subject to taxation of earnings and a 10% additional tax unless an exception applies.
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Withdrawals before 59½ may be subject to a 10% early withdrawal penalty unless an exception applies.
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Required Minimum Distributions (RMDs)
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Not subject to required minimum distributions during the lifetime of the original owner.
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RMDs must begin at 72.
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Maximum Contribution
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2022: $6,000 ($7,000 if you are 50 or older) or 100% of employment compensation, whichever is less.
2021: For 2021, the limits are the same as 2022.
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2022: $6,000 ($7,000 if you are 50 or older) or 100% of employment compensation, whichever is less.
2021: For 2021, the limits are the same as 2022.
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Catch-up Contribution
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Individuals age 50 or older (in the calendar year of their contribution) can contribute an additional $1,000 each year.
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Individuals age 50 or older (in the calendar year of their contribution) can contribute an additional $1,000 each year.
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Contribution Deadline
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Friday, April 15, 2022 for the 2021 tax year.
Thursday, April 15, 2021 for the 2020 tax year.
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Friday, April 15, 2022 for the 2021 tax year.
Thursday, April 15, 2021 for the 2020 tax year.
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Minimum to Open
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There is no minimum to open a Traditional IRA or Roth IRA.
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There is no minimum to open a Traditional IRA or Roth IRA.
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