Setting Up An IRA
It's easy to open an Individual Retirement Account (IRA). All you do is complete some simple paperwork for the IRS and make a financial contribution. You'll also need to follow some important rules so you don't get stuck paying tax penalties.
The financial institution that administers your IRA will keep track of the contributions you make. You can open your IRA at a credit union such as San Diego County Credit Union, a brokerage house, bank, or savings and loan association.
What You Should Know
Maximum Contribution
All IRA contributions must come from your earned income. This includes your wages, salary, tips, and bonuses. Here's a look at IRA maximum contributions for the next few years:
| Tax Year |
Maximum Contribution for those younger than 50 |
Maximum Contribution for those who are 50 and older |
| 2006 |
$4,000 |
$5,000 |
| 2008 |
$5,000 |
$6,000 |
| 2009 |
Indexed for inflation |
$1,000 more than the maximum |
| 2010 |
Indexed for inflation |
$1,000 more than the maximum |
Unemployed Spouses
If both you and your spouse are employed, you can each contribute the maximum amount to your own IRA each year. If only one of you is employed, consider setting up a regular IRA for the working spouse and a spousal account for the non-working spouse.
Making Contributions
You don't have to deposit the same amount of money in your IRA each year. And, you can make contributions to more than one IRA. However, each person's total IRA contribution can't be more than the maximum contribution for that year.
For More Information
Internal Revenue Service
It's best to go to the source to find out how the Internal Revenue Service (IRS) regulations affect your ability to save through a Traditional or Roth IRA. Read IRS Publication 590: Individual Retirement Arrangements. You can order the publication by calling (800) 829-3676 or you can read it online at the IRS Web site.
When you're ready to start investing in your future, let San Diego County Credit Union help. Visit our IRA Service Center at sdccu.com, call toll-free (877) 732-2848 or stop by any of our convenient branch locations for information.
|
