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Traditional IRAs FAQ

What is a Traditional IRA?

A Traditional IRA (Individual Retirement Account) is a self-sponsored retirement savings plan. Contributions to an IRA may or may not be tax-deductible depending on your adjusted gross income. Consult your tax advisor to answer questions about your eligibility for tax deductions.

Can I contribute to a Traditional IRA if I have other retirement plans?

Yes, you can contribute to a traditional IRA whether or not you are covered by another retirement plan. However, you may not be able to deduct all of your contributions if you or your spouse are covered by an employer-sponsored retirement plan.

How much can I contribute to a Traditional IRA each year?

The maximum contribution to a Traditional IRA is $5,000 or 100% of earned income per tax year, whichever is less. You must reduce this contribution by the amount contributed to a Roth IRA in the same year.

I’m over age 50. May I contribute more than $5,000 to my Traditional IRA? 

Yes. IRA holders age 50 and older may contribute an extra $1,000 to their IRA in addition to their regular contribution.

When am I required to begin taking distributions from a Traditional IRA?

By April 1 of the year after you become age 70 ½.

This site is provided for your information and does not constitute tax advice. Please consult with your accountant or tax advisor for specific guidance.

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