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IRA & Roth IRA

The Self-Employed Guide to Getting Started with an IRA

Investing, IRA & Roth IRA, Retirement

The Self-Employed Guide to Getting Started with an IRA

 

Saving for your retirement is a must, no matter what one’s current financial status may be. As daunting a task as it might seem, there are ways to make it, thanks to the various retirements schemes and plans out there.

One of the most common and popular retirement plans is the Individual Retirement Account. Popularly called the IRA, it is a savings account made to help people save up money that they can later spend when they retire. They are of 2 types – Traditional and Roth IRAs. While the former allows providing deduction for holders’ contributions and helps them defer taxes on their savings till the time of withdrawal, the latter does not offers it’s holders any such provisions. That being said, it does make investment earnings both tax and penalty-free during withdrawal. Both of these plans are usually offered by employers.

For small business owners and the self-employed, however, there is a slightly different variation of the IRA. Called the Simplified Employee Pension or, simple the SEP IRA, this is a variation of the the traditional IRA tailored for the self-employed. Freelancers, and small business owners with at least one employee are eligible for an SEP IRA.

Here is how you can get started to open your IRA account, and by extension, start building your own retirement nest egg:

Step 1: Decide the IRA that suits you the best

Before you even begin the process of opening your IRA, you need to make your priorities straight. The first step towards doing that is to decide upon the plan that would suit you the best. There are several factors that will influence the type of IRA you should use – these include (but are not limited to) – your income, age, debts, tax status and overall financial status.

Step 2: Consider opening an SEP IRA

For several freelancers and small business owners, opening an SEP IRA is a viable option, since they can easily use it to make tax-deductible contributions for themselves and/or their business. It is therefore important that you consider if an SEP IRA would work better in your particular situation.

Remember: Only you – the owner and employer – can contribute to your IRA.

Step 3: Choose where you would like to open your IRA

The next important step to take is to choose the place where you will be opening your IRA. The appropriate thing to do is to choose the account provider that offers the lowest possible account fees, good customer support, commission-free exchange funds, and a range of mutual funds sans transaction fees.

Step 4: Decide upon the amount of initial deposit you would like to make to start your IRA

Your initial funding is the first step to determining how much your IRA would be worth and how much you can and should possibly contribute to it. While a few brokers do have $0 minimum deposit rate, most require a minimum investment of $1,000.

Step 5: Plan your investment options

There are several ways to invest in IRA funds – individual stocks, bonds, and mutual funds are some of those ways. Make sure to choose the investment options that suit your situation best and help you make the most with the least risk.

Step 6: Plan your time on when and how you would like to manage your IRA

Opening and maintaining an IRA requires time and involvement – which is tricky when you are freelancing or running your business. Make sure to devote some time to pay attention to IRA matters, given how crucial they would be after you retire. Additionally, you can utilize a robo-advisor to help manage your account with the help of computer algorithms.

Step 7: Decide your marital status when you open your IRA

Your marital status determines the extent and contributions of your IRA. For instance, if you file your IRA as a with your spouse (if that is applicable), you can make twice the amount of contributions.

Step 8: Consider the option of opening your IRA online

In today’s day and age, when technology is at its prime and time if of the essence, the internet is one of the best places for the self-employed to open an IRA. All you need to do is to go to the website of the provider and fill in the relevant information such as employment information, social security number and contact information.

Step 9: Plan the funding of your IRA account

How you fund your IRA is a crucial step in determining where your account would stand eventually. Make sure to include your account number when you set up your IRA.

Step 10: Make automatic transfers to your IRA account

Setting up automatic transfers has more benefits that you can count. Not only does it help allocate a fixed amount every month, it would help you structure your expenses around it. It also acts as a reinforcement in maintaining your bank account, given how you would like to avoid making any kind of defaults (and the amount of fees that it would entail).

 

TOP 3 IRA MYTHS

Investing, IRA & Roth IRA, Retirement

TOP 3 IRA MYTHS

 

For most, one of life’s biggest goals is to have saved enough to live out their retirement peacefully and with financial independence. It is therefore, highly essential to have a proper retirement savings strategy in place.

Individual Retirement Accounts (IRA) can – and do – play a very vital role in such situations – being one of the most common ways for people to set aside money to be used during retirement. IRAs are of two types – traditional and Roth – money going into a traditional IRA is contributed as tax-deferred, but taxed when withdrawn, while money going into a Roth IRA only goes into the account after tax deductions but is tax-free when withdrawn. You can either contribute through one or the other, or sometimes even both, so long as you stay within the annual limit for making contributions.

Given the rather complex nature of IRAs, and the confusion around the same, there are several myths that surround them, which can often cause unnecessary distress on the part of both present and would-be contributors.

Here are three key misconceptions that surround IRAs, and what really is the truth about them:

Myth #1 – You cannot contribute to an IRA if you are unemployed:

Although it is mandatory to be an active income earner to qualify for contributing to an IRA, the Internal Revenue Service does have exceptional provisions whereby those who are technically unemployed can also make contributions. The most common of these is the spousal IRA.

As the name implies, the spousal IRA allows the unemployed spouse to contribute to the IRA (within contribution thresholds), so long as their spouse is employed. It works as a suitable option especially for women, who tend to take at least some time out of their careers at some point (either to have and/or raise children or to care for their elders). For them, the spousal IRA can allow them to track their retirement savings and keep to the norm – even if they are temporarily not working.

To qualify for spousal IRA, the non-working spouse must:

  • Be married
  • Be able to file returns for joint income tax
  • Have a household earned income that matches the contributions made by the working spouse to their IRA, and the non-working spouse to their spousal IRA

Myth #2 – If your earnings are more than the specified income thresholds, you will be disqualified:

Whereas earning a large income is always a great thing, it can disappoint when it comes to contributing to an IRA. This is because there are set limits when it comes to making IRA contributions.

In the event that you don’t have a workplace retirement plan in place already, it is possible for you to make contributions (and later fully deduct your contributions) even if you make a salary as high as $1 million. Limits can still arise, however, in case you are not covered but your husband or wife is.

In the event that you do have a workplace retirement plan, your income will cast a larger shadow on your eligibility to contribute. If you earn $72,000 or more and are single, or earn $119,000 or more, and are married, you are ineligible to deduct any part of your traditional IRA contributions. That said, you could continue to contribute to a traditional, non-deductible IRA.

Roth IRAs, however, are much more stringent. Earning a higher income can easily disqualify you from making direct contributions. This applies even if your current workplace does not offer you a retirement plan.

All said and done, you could still save via the “backdoor” option – this happens when you make a non-deductible contribution to a traditional IRA, and thereafter and then convert said contributions into a Roth IRA one.

Myth #3 – You cannot contribute to an IRA if you have a workplace plan in place:

This is a big confusion surrounding IRAs – and a false one too. Many think that if their workplace has a retirement plan like a 401(k) in place, they are ineligible to contribute to IRAs. The truth, however, is that if you are employed and under the age of 70 years and 6 months, you can contribute to a traditional IRA. The only caveat here would be that you would not be able to make deductible contributions. For Roth IRAs, you can contribute at any age, so long as your income lies below a certain limit.

 

THE FREELANCERS GUIDE TO INVESTMENT SAVINGS ACCOUNTS

Investing, IRA & Roth IRA, Retirement, Tax-Minimization

THE FREELANCERS GUIDE TO INVESTMENT SAVINGS ACCOUNTS

 

Living the freelancers’ life is the dream for many – the ability to be your own boss, set your own working hours, and achieve a higher level of work-life balance. And with over 36% of the American workforce engaging in some or the other kind of freelance work, the gig economy is indeed going from strength-to-strength.

That being said, the working for the gig economy also comes with its own downsides, most of all being the lack of any kind of employer-sponsored benefits and retirement accounts like the IRA or 401(k). Having a clear absence of such a structure makes it very difficult, if not impossible to save for retirement in a clear-cut manner.

With the right perspective, however, this supposed weakness can easily be turned into a strength. Whilst you do not have a solid employer-sponsored 401(k) as a freelancer, you are your own boss and do have the flexibility to make a lot of choices the average employee couldn’t. As a freelancer, you can (and should) take advantage of the options that you do have and can use to save for retirement.

Here are some common investment accounts that you can use to save for the future as a freelancer:

Traditional and Roth IRAs

Individual Retirement Account (IRA) allow individuals to set aside part of their savings for their retirement. As a freelancer, you can choose and work with either of a traditional or a Roth IRA, or even a plan that combines the two. Those aged 50 or less can deposit up to $5,500 into a traditional or Roth IRA or a combined plan. Those over 50 can deposit an extra $1,000.

Any money that you deposit into a traditional IRA is pre-tax, so your savings will be subject to tax when you withdraw them during retirement. Roth IRA, on the other hand, requires you to pay the taxes on the money before you deposit it, making the withdrawn money tax-free.

Opening an account is easy – you can easily do it online through a broker, such as Betterment, Vanguard, or Fidelity.

SEP IRA

A Simplified Employee Pension IRA (SEP IRA) is a retirement account ideal for those who make their living as freelancers. In this plan, workers can add either of $55,000 or 25% of their net earnings – whichever turns out to be the lesser – annually. Accounts can be set up with online like with a traditional IRA, and contributions can be easily deducted.

Solo 401(k)

As the name implies, a solo 401(k) is exactly that – a 401(k) account for a single person. It is similar to the traditional 401(k) in the sense that you can deposit up to $18,500 into the account ($24,500 if you are 50 years old or more), but given that you act as both the employer and employee, it is possible for you to make additional contributions as an employer, and therefore boost your total contributions. Subject to your income and IRS calculations, the total amount you can add becomes up to $55,000 per year.

Make sure to open your account by December 31st of the year in which you intend to contribute – for instance if you want to contribute for 2019, you have to open your account before or on Dec. 31, 2019.

How much should you save for retirement?

The amount one needs to save for retirement is different for everyone as it is based upon various factors such as age, debts, saved money and assets, and current income. That being said, a general rule is to save around 10% to 15% of your income in a retirement account at the very least. The more you can increase the percentage, the better it will be.

Another factor that is you must consider before embarking on saving for retirement is debt load. If you’re among the freelancers who have high-interest loans (like soft loans or pending credit card bills), you should first concentrate on paying-off and neutralizing said debts before you begin to save. This is because the annual interest you would be paying on said loans would be greater than the returns you would be receiving from the retirement savings.

On the flip side, if you have low-interest debts (like federal student loans or mortgage), you should start saving for retirement right away, whilst making sure than you are also paying your loan debt(s).

 

YOUR GUIDE TO SAVING FOR RETIREMENT – NO MATTER WHAT YOUR AGE

IRA & Roth IRA, Retirement

YOUR GUIDE TO SAVING FOR RETIREMENT – NO MATTER WHAT YOUR AGE

 

Having enough money for retirement is a crucial factor in life. After all, this is the time to rest and take it easy without the worries and rigors of active working. It is only paramount, therefore, that the more money one has, the more comfortable one can be.

While it is true that the earlier one begins investing, the better are the chances of saving more (courtesy compound interest), one can always save more for retirement even at later stages of life.

Here are some universal tips that can help you grow your retirement nest egg, no matter you’re your age is:

Start now: Taking the first step is the most essential thing to do when saving for retirement, especially if you are in the later stages. Don’t let overthinking get in the way of taking a step towards saving more. If you’re younger, you should definitely pay attention to start saving and investing as much as you possibly can and allow for compound interest to work in your favor as much as possible.

Add to the 401(k): One of the time-tested and best ways to save for retirement is having a 401(k) plan in place. In many workplaces, employers offers a traditional 401(k) plan, allowing employees to contribute pre-tax money, that offers considerable advantages.

Start your IRA: Having an individual retirement account (IRA) is yet another great way to build up your nest egg. IRAs come in two varieties – the traditional IRA, and the Roth IRA. Traditional IRAs are usually ideal for those who already have a workplace retirement plan, has tax-deductible contributions, and offer the opportunity to keep tax-deferred till the point after retirement when you start making your withdrawals. Roth IRAs, on the other hand, are more suitable for those with more phased-out income limits. Generally more flexible, they are funded by after-tax contributions, and have their qualified distributions (earnings included) enjoying a federal-tax-free (and sometimes even state-tax-free) status, provided you are at least 59½-years-olf, and meet the minimum holding period requirements.

Use catch-up contributions: Given the limited capacity of 401(k) plans and IRAs, beginning to save early in life is an absolute must. That said, if you’re among the many who are in the later stages of life and have save nothing-to-less, all is not lost. For those aged 50 and above – you can take advantage of being eligible to make “catch-up” contributions to IRAs and 401(k)s by contributing more than what is the monthly limit. This will play a great role in boosting your retirement savings.

Keep your expenses in check: Much as anyone would hate to admit it, expenses have a habit of expanding all the time. While some of this is natural (due to inflation, the economy, rising costs of essentials, etc.) not all of it may be justified. Making regular checks of your expenses can help you track lifestyle and spending habits, come up with better ideas and reasonably save wherever it is possible to do so. For instance, bringing home-cooked lunch to work is a better option (both in terms of health and money) than buying lunch at work. Having a reduced spending allows you to have extra money on your hands which you can then save or invest.

Keep an emergency fund: No matter what your age, marital status or cashflow, having, maintaining and growing an emergency fund should be a must for anyone. During times of crisis (which despite all efforts, can strike anyone at any time), emergency funds can help rescue you from having to fork out from your regular expenses and even your savings. One way you can actually maintain and grow your emergency fund is by regulating how you spend the money you get paid extra – for example, when you receive a raise. Tempting as it is to spend the extra cash on little-to-moderate luxuries, it will be far more rewarding to stash at least half of it in the emergency fund.

If/When you’re closer to retirement, try and delay Social Security: This is one of the best ways to save for anyone who is closer to retiring. By delaying Social Security payment every year before reaching the age of 70, you can increase the amount of money you will receive during retirement to a good extent. You can start delaying Social Security at the age of 62 (which is the age when you start receiving them), delay all the way till you are 70. That way, you can make a significant difference to the amount you receive every month post-retirement, as well as potentially increase the amount of survivor benefits for your partner or spouse.

 

Roth or Traditional IRA: Which one should you go for?

IRA & Roth IRA

Roth or Traditional IRA: Which one should you go for?

If you’re one of the many approaching retirement, you will need a source of money that will sustain you for 20 years where you will not be actively working. Individual Retirement Accounts (IRA in short) form a great option in this regard.

That being said, IRAs bring forth the dilemma of having to choose between two types – a conventional IRA and a Roth IRA. Both have their owns sets of advantages and disadvantages. While the Roth IRA is a better choice for those who anticipate the tax rates to be higher, the traditional IRA is a better option for those expecting a lower tax bracket in the future.

One can also consider splitting between Roth and traditional IRA if they feel that it is rather impossible to predict where the tax bracket will go in the future.

Is choosing between IRAs simple?

The various details explaining the differences between Roth and traditional IRA are based upon endless analysis done with accordance to detailed IRS doctrine. How one chooses depends on the properties of each type and how they fit with the prospective holder’s particular situation. This includes two main factors:

Eligibility: Eligibility for Roth and/or traditional IRA is dependent upon the individual’s income. This entails being within certain income parameters (in case of Roth IRA) and the ability to make tax-deductions (in case of traditional IRA).

Picking a place: With many customers becoming eligible for both varieties of IRA, and even for those eligible for a single type, there can be various choices which can make things overwhelming. The best way to pick up a place for IRA is to go on the basis of the temperament of the holder, i.e. whether they prefer to have their finances managed or are comfortable doing so themselves.

Roth vs. Traditional IRA – 4 Key Differences

Roth and traditional IRAs are similar in the sense that they both act as a great tax-advantaged option for retirement saving. That being said, they also have some key differences:

Taxes: The how and when of getting a tax break is perhaps the biggest difference between the Roth and traditional IRA. While traditional IRAs have the advantage of having tax-deductible contributions, Roth IRAs have the tax advantage of getting withdrawals that are not taxed. In other words, a traditional IRA requires you to pay taxes when you withdraw your earnings during retirement (or even before it), the Roth IRA requires you to pay taxes upfront, but withdraw tax-free.

Contribution limits: Both the Roth and the traditional IRAs have their own sets of eligibility rules and restrictions which determine the extent to which you can contribute. While traditional IRAs have no income restrictions, Roth IRAs require contributors to stay within a certain income threshold.

In case you find yourself eligible for both, you can split your contribution to both accounts in the same year. Just make sure that that your total amount does not exceed the threshold of $5,500 (or $6,500 in the event that you are of 50 years of age and above.

Apart from paycheck size, traditional IRA deductibility considers other factors such as your account tax filing status and if you and/or your partner are covered by any employer-sponsored retirement plan.

Early withdrawals: Generally speaking, it is not a good idea to draw money from an IRA prematurely. In fact, there are rules to prevent just that, chief among them being that you must be at least age 59½ of age or pay taxes and penalties for early withdrawals.

That said, sometimes one must go to that pool of money to fulfill their requirements.

Withdrawing money from a traditional IRA pre-mature levies a 10% early-withdrawal penalty, and also makes the money you withdraw taxable at the current tax rate. Roth IRAs, however, are more lenient and offers better terms to those who withdraw pre-retirement. However, in order to take advantages of said terms, the first Roth IRA contribution needs to be at least 5 years older than the date of the first withdrawal.

Required minimum distributions: Long after all is done, you will be subjected to paying required minimum distributions (RMDs) from your traditional IRA. This often motivates many to make further contributions to make their IRA funds bigger.

This is, however, impossible in case of a traditional IRA, which does not allow for additional contributions once you are 70½. Moreover, you are required to withdraw once you reach that age. Roth IRA, however, is much less stringent, and allows you to keep your savings in the account for as long as you live, while contributing past the age of 70½. If you’re among the many who feel that they don’t need to use their IRA assets straightaway, and can wait for a while, Roth is a great option for them.

ROTH IRA VS. TRADITIONAL IRA

IRA & Roth IRA

ROTH IRA VS. TRADITIONAL IRA

With the time to pay taxes approaching soon, most taxpayers in the US are currently contemplating on what method they should use to save their money. One of these methods being funding IRAs, it is only natural for the ones contemplating those to wonder whether they should opt for a Roth IRA or a traditional one. Each have their own sets of benefits, and prove to be more efficient for certain situations than others.

Are you wondering which IRA you should use? Here are some guidelines to help you understand the difference between the two.

Contribution Limits

Both Roth and traditional IRAs have the same contribution limits. As of 2017, you can contribute up to $5,500 to your IRA. You can also contribute an extra $1,000 as catch-up if you are of age 50 or above by the end of the tax year.

Deductibility

The eligibility of an individual to deduct traditional supplements to an IRA (and therefore receive a tax credit for the year in which the contribution was made) makes for a major factor in deciding between a Roth and a traditional IRA. This eligibility is directly dependent on whether the taxpayers fulfills the minimum requirements.

According to Dan Stewart CFA®, president of Revere Asset Management, Inc., in Dallas, Texas, a traditional IRA can be fully tax deductible if the taxpayer and the taxpayer’s spouse are not participating in any work-based retirement plan (regardless of income), or if they participate in a work-based retirement plan but have an income of $62,000 (if they are filing individually) or $99,000 (if they are filing jointly). Any contributions made beyond those levels will not have any influence over deduction of taxes.

For Roth IRAs, however, contributions are not able to be deducted.

Age Limitations for Contributions

If making contribution supplements to your IRA it is your priority, you must take a close look on the age caps placed on IRA contributions for either types of IRA.

In case of traditional IRAs, contributions cannot be made once the taxpayer has reached the age of 70½. Roth IRAs, however, don’t have any limit of this sort.

Age is not the only factor here, though, the income also determines the ability and eligibility to fund a Roth or traditional IRA. For instance, it is not possible to make contributions to a Roth IRA if the income exceeds a certain threshold. Additionally, the Roth IRA can be lowered should the income ever fall to a certain range. It is thus, always best for taxpayers to consult with the tax advisor to find out the maximum amount they can contribute to a Roth IRA.

Traditional IRA contributions, on the other hand, do not have any such income caps.

Required Minimum Distributions

In order to prevent yourself from having to start distributing your retirement assets before time, taxpayers must heed to the IRA rules for required minimum distributions (RMDs).

Traditional IRA owners are required to take their RMDs by April 1 of the year following the year they reach the age 70½ (which is the contribution age limit). They must, therefore, gradually reduce their IRA balance and add the distributed amount to your income, regardless of whether they actually require the funds.

Roth IRA owners, on the other hand, are not required to follow any RMD rules.

Tax Treatment of Distributions

Yet another factor that determines the which of the two IRAs are beneficial is the tax treatment of distributions. Usually, traditional IRA distributions are regarded like regular income (which therefore can be subject to taxes for your income). Additionally, the amount distributed may be subtracted by the penalties in case the withdrawals have been made before the taxpayer has reached the age of just over 59.

A Qualified Roth IRA distribution, however, is fully exempt from tax and penalty. To get qualified, Roth IRA distributions must meet a few fundamental requirements:

– The allotments must be taken at least 5 yrs after the taxpayer has funded their primary Roth IRA

– The distribution was taken as a result of at least one of the following factors:

The taxpayer has reached the age of 59½

The taxpayer is disabled.

The assignee will receive the full distribution upon death of the taxpayer

The distribution has been used to make a sale on a primary residence ($10,000 lifetime limit)

Splitting Your Contributions:

It may so happen that the taxpayer finds themselves eligible to contribute to either types of IRAs. In that case, they can choose to divide their contributions between their traditional and Roth IRAs. That said, they must take care to not allow the total amount of contributions to both IRA’s to exceed the tax limit. This figure includes the catch-up contribution if the taxpayer is over the age of 50.

Additional fees should also be considered when splitting IRAs. This includes additional fees, like the maintenance fees charged by your IRA custodian/trustee who will maintain both IRAs.

Which one is better?

As expected, this is not a simple “Option A or Option B” answer. The detrimental factor for most taxpayers is their eligibility to deduct their IRA contributions, which often leads them to opting for traditional IRAs. That said, this eligibility does not imply that the traditional IRA is always the better choice.

Roth IRAs have some inherent benefits of their own. This includes things like penalty-free distributions and freedom from RMD rules and taxes, which generally outweigh the benefits of getting a tax deduction.

If you’re still confused, you can use a Roth vs traditional IRA calculator, which can help you logically decide the better account for you.

Traditional IRA or Roth IRA: Which is the right one for you?

IRA & Roth IRA

Traditional IRA or Roth IRA: Which is the right one for you?

As many today already know, it is not a good practice to simply rely on workplace-sponsored retirement accounts. You must have alternate ways to save, such as stashing extra saving into a personal retirement account (IRAs in short).

IRAs are a good way to save since they make for a better compound and offer better tax benefits. The amount of benefits you get, however, depends on which type you select traditional or Roth.

When it comes to choosing ones, things can get confusing. After all, as of 2015-2016, yearly payments made to both are similar i.e. $5,500 per person for those under the age of 50, and $6,500 for those aged 50 and above. However, according to many experts, the Roth IRA stands as a better candidate since it is more flexible in terms of funding and withdrawing funds and offers bigger tax benefits.

According to Rick Meigs, 401kHelpCenter.com president, Roth IRA is definitely the better option. He particularly finds it better on account of the fact that it does not have the mandatory requirement of taking withdrawals at seventy and one half, and allows people to keep forwarding payments there.

While payments to a Roth IRA are indeed funded with post-tax earnings, they go on to become tax-free and can be withdrawn as such as well, in the event that the account is at least years old, and that you are at least 59 1/2 old at the time of distribution.

Meigs finds the feature of being able to contribute to Roth as long as one earns money particularly helpful, especially for those who intend to work beyond their past traditional retirement years. On the flip side, savers stand to pay a 10% penalty if they withdraw earnings before they turn 59 1/2. After that age, however, they can withdraw the contributions at any time.

It does not come without its problems, however. Sometimes, you may find that you are in fact “earning too much” to fund a Roth IRA. Roth IRAs are generally available exclusively to with a modified A.G.I. that is below of $132,000 in 2016. For married couples filing a joint tax return, this figure stands at $194,000.

In case your income renders you ineligible to funding a Roth IRA, you should consider the traditional IRA. It does have its own set of advantages.

Perhaps the biggest advantage of a traditional IRA is the fact that it allows you to claim a complete income-tax deduction for your contributions. To take that advantage, you must not have access to another work retirement plan, like a 401(k). The income cap for single filers who have access to any such plans is $61,000; they can get a partial deduction if their earning is above $61,000 but below $71,000. Income limits are trickier for married couples who file jointly, those with a plan have a limit that can be anywhere between $98,000 to $118,000. If you don’t have a plan but your spouse does, you can get a limit that stands anywhere between $184,000 and $194,000. Once again, if you don’t have another office-sponsored retirement plan, you can get the full tax deduction for your contributions no matter what your income is.

And in case you cannot claim tax breaks from traditional IRA altogether, you can still make nondeductible contributions to a traditional IRA. Since 2010, you also have the option to convert a traditional IRA to a Roth, regardless of your income and filing status.

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