Traditional IRA

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Traditional IRA Facts at a Glance (cont)

Traditional IRA Features

• Fully deductible contributions for certain spouses not covered by a retirement plan:

Formerly, IRA contributions were not deductible if either you or your spouse participated in an Employer Retirement Plan and your combined income exceeded a certain level. If your combined income is less than $150,000, you may be eligible to make a fully deductible IRA contribution to your Traditional IRA even if your spouse participates in an Employer Retirement Plan as long as you do not participate in one. 

The allowable amount of the IRA deduction is phased out between $150,000 and $160,000 income levels. This provision applies to non wage earning spouses as well as employed spouses not covered by a retiremetn plan. 

• Penalty free IRA withdrawal for major life events

An IRA allows you to make penalty free IRA withdrawals at any age if you use the money for one of the circumstances outlined in the IRA Distrition section. 

• Catch up IRA contribution for people of at least 50

Any individual who is at least age 50 will be permitted to contribute an additional $1,000 (2006 and later) to their IRA as a catch up IRA contribution.