Individual Retirement Account: Difference between revisions
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*Traditional IRA: Contributions may be tax-deductible, and earnings grow tax-deferred. | *Traditional IRA: Contributions may be tax-deductible, and earnings grow tax-deferred. | ||
*Roth IRA: Contributions are made with after-tax dollars, but qualified withdrawals in retirement are tax-free. | *Roth IRA: Contributions are made with after-tax dollars, but qualified withdrawals in retirement are tax-free. | ||
Why not put all one's cash into Roth IRA? $7k/year limit [https://www.youtube.com/watch?v=CA9R0TT2Y4g]. But good thing is, benefits are tax free. | |||
Revision as of 04:44, 11 April 2025
Also known as IRA. When a spouse inherits it, new beneficiaries must be named, and you can do these 4 things:
- Keep spouse's IRA
- Move spouse's IRA assets into your own account
- Same as last point but convert IRA into Roth IRA
- Discharge
Now, if:
- Traditional IRA: Contributions may be tax-deductible, and earnings grow tax-deferred.
- Roth IRA: Contributions are made with after-tax dollars, but qualified withdrawals in retirement are tax-free.
Why not put all one's cash into Roth IRA? $7k/year limit [1]. But good thing is, benefits are tax free.