Monday 03/07/2016

Enhance Your Retirement

Al Harsar, CPA gives tips for tax-free retirement savings:

 

 

Saving for retirement is a no-brainer. But, wouldn’t you like to earn your retirement money on a tax-free basis? As a taxpayer, you have that option by using the benefits of a Roth IRA to save for your retirement.  Here’s how it works:

  1. Contributions to a Roth can be made with after-tax dollars, the benefit being that you pay no taxes on the appreciation when you withdraw from the Roth IRAs in the future.
  2. There are no Required Minimum Distributions (RMDs) when you turn 70 ½, like there are for traditional IRAs. For 2016, a taxpayer can contribute up to $5,500 plus an additional $1,000 for those that are 50 years old or older.  Contributions are subject to phase-outs based on Adjusted Gross Income limitations.  Roth IRA contributions for 2015 can be made up until April 15,
  3. Direct contributions to a Roth IRA may be withdrawn tax and penalty-free at any time and any earnings may be withdrawn tax and penalty-free after 5 years if the owner is 59½. Additionally, rollover contributions that are converted before age 59½ and held in a Roth IRA may be withdrawn tax and penalty-free after 5 years.
  4. Finally, your Roth IRA can be passed on to your heirs.

So start saving now to enhance your retirement with one of the only investments that provides you with tax-free earnings…what are you waiting for?

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