Business & Finance Personal Finance

What Is a Roth Plan?

    Types

    • Two types of Roth IRAs are available as of 2010: the standard Roth IRA and the Roth 401k. The standard plan is open to anyone wishing to have an IRA savings plan. A Roth 401k is an employer-sponsored plan.

    Contributions

    • An individual may make an annual contribution of up to $5,000 to a Roth IRA as of 2009. Contributions are made with taxed-income; no deduction for contributions made into a Roth IRA is available on a tax return. Through a Roth 401k plan, employees can contribute up to $15,000 a year.

    Limitations

    • Income limitations apply with the standard Roth IRA. Single individuals must make less than $110,000 adjusted gross income to contribute; married couples must make less than $160,000.

    Withdrawals

    • Both types of Roth IRAs contain contributions that have already been taxed; therefore, there are no future tax consequences on the account. When withdrawals are made, the account holder pays no taxes as long as he meets certain requirements: the account holder must be at least 59½ years old and the account must be held for at least five years before the withdrawal.

SHARE
RELATED POSTS on "Business & Finance"
Can I Fund an IRA if I Have a 403b?
Can I Fund an IRA if I Have a 403b?
How to Raise a Credit Score in a Shorter Time
How to Raise a Credit Score in a Shorter Time
Can I Withdraw From My Pension Plan If I Leave the Company?
Can I Withdraw From My Pension Plan If I Leave the Company?
How to Describe the Curve of Exponential Growth
How to Describe the Curve of Exponential Growth
Government Assistance Pell Grants
Government Assistance Pell Grants
Optometry Scholarships & Grants
Optometry Scholarships & Grants
How to Invest in a Microloan
How to Invest in a Microloan
Most Affordable Place to Live & Retire in the U.S.
Most Affordable Place to Live & Retire in the U.S.
Facts About IRA Saving Accounts
Facts About IRA Saving Accounts
Can You Increase Social Security Benefits by Working After Collecting Social Security?
Can You Increase Social Security Benefits by Working After Collecting Social Security?
The Only Way To Trade Exponential Moving Average
The Only Way To Trade Exponential Moving Average
How to Fix a Bad Credit File
How to Fix a Bad Credit File
Can You Withdraw Funds From a Traditional IRA to Pay Your College Tuition?
Can You Withdraw Funds From a Traditional IRA to Pay Your College Tuition?
How to Open a Free Secured Bank Account Online
How to Open a Free Secured Bank Account Online
Government Grants for Home Improvement for Low Income People
Government Grants for Home Improvement for Low Income People
Does Checking Your Credit Report Lower Your Score?
Does Checking Your Credit Report Lower Your Score?
Legal Consumer Credit Counseling
Legal Consumer Credit Counseling
Reverse Repurchase Agreement Definition
Reverse Repurchase Agreement Definition
How to Calculate Equity Dilution
How to Calculate Equity Dilution
What Effects My Credit Score?
What Effects My Credit Score?

Leave Your Reply

*