Jan 23

I currently have a deductible IRA.


2 comments so far...

  • jlf Said on January 23rd, 2010 at 5:00 pm:

    There is no such thing as “deductible” and “non-deductible” IRAs. Whether IRA CONTRIBUTIONS are deductible in a given tax year depends on income and certain other factors.

  • the tax lady Said on January 23rd, 2010 at 5:24 pm:

    In theory yes.

    For 2009, your limit for all types is $5000.
    If you are single, covered by a plan at work and have income between $53,000 and $63,000, you will be limited on how much you can deduct–so some would be deductible and some wouldn’t. (You don’t need two IRAs, this is just record keeping.)

    Then in 2010, you could roll all of the money to a Roth and only pay taxes on the portion that you got a deduction for in 2009. This would only be beneficial, taxwise, if you are in a LOWER tax bracket in 2010, say from losing your job or retiring.

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