A Roth IRA is an individual retirement arrangement that, except as explained below, is subject to the rules that apply to a traditional IRA. To be a Roth IRA, the account or annuity must be designated as a Roth IRA when it is set up. Unlike a traditional IRA, you cannot deduct contributions to a Roth IRA. But, if you satisfy the requirements, qualified distributions (defined in Publication 590) are tax free. Contributions can be made to your Roth IRA after you reach age 70 1/2 and you can leave amounts in your Roth IRA as long as you live. EligibilityYou can establish a Roth IRA by making a regular contribution to a Roth IRA or by converting a traditional IRA to a Roth IRA. You can convert your regular IRA to a Roth IRA in 2010. You'll have to pay tax in the year of the conversion, but for many people the long-term savings outweigh the conversion tax. Qualified Distributions fro a Roth IRA: A qualified distribution is any payment or distribution from your Roth IRA that meets the following requirements. Contact your Montello Wealth Financial Consultant Your Montello Wealth Financial Consultant can assist you in understanding the ROTH IRA. |