Individual Retirement Account


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Related to Individual Retirement Account: Roth Individual Retirement Account

Individual Retirement Account

(IRA), tax-sheltered retirement plan, originally created (1974) to assist individuals not covered by company pensions. Under the U.S. tax law of 1981, IRA provisions were liberalized to allow individuals to contribute up to $2,000 per year (up from $1,500) to such accounts, and coverage was extended to employees already in corporate pension programs. These contributions are deductible from federal income taxincome tax,
assessment levied upon individual or corporate incomes. Although personal incomes were occasionally taxed in medieval Italian cities, the income tax is essentially a modern form of taxation.
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 payments. IRA monies may be placed in high-yield investments, with taxation deferred until money is withdrawn after retirement. In 1998, Congress instituted the Roth IRA, in which the earnings are tax-free but there are no tax-deduction benefits for the contributions made each year.
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Younger workers, however, could invest some of their payroll taxes into higher-risk, potentially higher-yield, Individual Retirement Accounts. Proponents of this approach assume that payroll taxes from the work force will perpetually support current retirees.
1.219-2(d) defines an "active participant" for individual retirement account eligibility purposes as, for the first year of participation in a plan, a person who participates as of the later of when a contribution is made or allocated.
The taxpayer sought to roll over the cash into an individual retirement account and keep the employer stock.
For Evans, this systematic monthly investing plan is facilitated through an individual retirement account (IRA) for self-employed persons known as a SEP-IRA.
A fee-only financial adviser usually will recommend a variable annuity only when the client has maximized qualified pension plan and individual retirement account contributions--and has cash left to invest.
The Service has held, in Letter Rulings 9931048 and 9931049, that multiple beneficiaries of a single individual retirement account (IRA) may use their own individual life expectancies to calculate their required minimum distributions instead of using the oldest beneficiary's life expectancy, when the IRA owner died before his minimum required beginning date (RBD).
IR-1999-78 provides that taxpayers have until the end of 1999 to change Roth individual retirement account (IRA) contributions or conversions for 1998 back to traditional IRAs.
If money is tight, premiums can be paid by using funds in an individual retirement account or 401(k).
The survey found that the top reason for moving funds from a retirement plan to a rollover individual retirement account was an existing relationship with a provider outside of the plan.
401(k) plan into an individual retirement account (IRA), because he is only age 50.
In 1995 a taxpayer took early retirement and received a $30,000 distribution from his individual retirement account. The taxpayer wanted this distribution to be the first of a series of substantially equal annual payments.

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