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| Traditional Individual Retirement Annuity (IRA) |
Contributions to a Traditional IRA may be tax deductible. Regardless of whether or not an income tax
deduction is received for the contribution, the earnings generated are tax-deferred. IRA holders do not include earnings from Traditional IRA's in their income until
the year a distribution is taken.
If you have a 401(k) or another employer sponsored plan from a former employer, you may be able to move it into a Traditional IRA, giving you total control of the
account.
The maximum amount that an individual can contribute to a Traditional IRA in 2006 is $4,000. Individuals who attain age 50 before the end of 2006 may be eligible to
contribute an additional $1,000 for a total of $5,000. See the chart below for contribution limits. |
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