Estate Planning Blog

A Primer on the Basics of IRAs

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IRAs are a great way to grow tax-free savings for your retirement, but the rules concerning their establishment and operation can be confusing. Our experienced attorneys can  you help determine how an IRA can fit into your estate plan.

Infographic detailing the two types of IRAs
OA LIFE GROUP BLOG ASK THE LAWYER<br >Title Individual Retirement Accounts<br >IRSs were designed to help people without a workplace retirement program to save for retirement in a tax favored way IRAs now represent the largest retirement savings in the United States with holdings of over $7 trillion in assets<br >1 WHAT ARE THE DIFFERENT TYPES OF IRAS<br >The two general types of IRAs are traditional and Roth IRAs Sometimes IRAs inherited from the original owner are referred to as Stretch IRAs because the tax deferred growth of the inherited IRA can be stretched out over the lifetime of a younger beneficiary but they do not exist as a third type of IRA<br >2 WHAT TYPE OF INCOME CAN I CONTRUBYTE<br >The two general types of IRAs are traditional and Roth IRAs Sometimes IRAs inherited from the original owner are referred to as Stretch IRAs because the tax deferred growth of the inherited IRA can be stretched out over the lifetime of a younger beneficiary but they do not exist as a third type of IRA<br >3 WHEN DO I HAVE TO TAKE THE MONEY OUT<br >The two general types of IRAs are traditional and Roth IRAs Sometimes IRAs inherited from the original owner are referred to as Stretch IRAs because the tax deferred growth of the inherited IRA can be stretched out over the lifetime of a younger beneficiary but they do not exist as a third type of IRA<br >4 CAN I CHANGE MY TRADITIONAL IRA TO A ROTH IRA<br >Yes changing your traditional IRA to a Roth IRA is known as a Roth Conversion You must pay income tax on the traditional IRA funds when they are withdrawn to fund your new Roth IRA<br >5 HOW MUCH CAN I CONTRIBUTE EACH YEAR<br >For 2018 you can contribute $5500 and for 2019 you can contribute $6000 If you are 50 or older you contribute $6500 in 2018 and $7000 in 2019 For each calendar year you can make your contributions as late as April 15th of the following year For example your 2018 IRA contribution must be made by April 15 2019

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