Nonspouse Beneficiary Rollovers
Beginning with employer plan distributions
after December 31, 2006, nonspouse
beneficiaries of deceased employer plan
participants may roll inherited employer
plan assets to an inherited traditional IRA.
This generally allows the individual to
take distributions over a longer period of
time—extending the tax deferral and
avoiding the potential tax pitfalls of a
lump sum employer plan distribution.
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Direct Your Tax Refund
to an IRA
Effective January 1, 2007, you may direct
the Internal Revenue Service (IRS) to send
any portion of your tax refund to an IRA
as a contribution, making it easier than
ever to save for your goals.
Ask us how these benefits and more
can help you establish a family
tradition of investing in the future.
This brochure is intended to provide general information concerning IRAs. It is
not intended to provide legal advice or to be a detailed explanation of the rules
or how such rules may apply to your individual circumstances. For specific
information, you are encouraged to consult your tax or legal professional. IRS
Publication 590, Individual Retirement Arrangements, and the IRS’s web site,
www.irs.gov, may also provide helpful information.
Teach your children well
Invest in an IRA
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Increased IRA
Contribution Limits
Tax Credit for Low-Income Savers
Certain low-income individuals may be
eligible for a nonrefundable Saver’s Tax
Credit for a portion of their contributions
to traditional or Roth IRAs, or for salary
deferrals to their employers’ retirement
plans. (The maximum annual contribution
eligible for the tax credit is $2,000.)
Now, you can contribute more money than
ever before to your traditional and Roth
IRAs. And, if you’re age 50 or older, you
can make “catch-up” contributions that
exceed standard contribution limits. Plus,
beginning in 2009, contribution limits will
be subject to cost-of-living adjustments.
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Relaxed Conversion Rules
Increased Traditional IRA
Deductibility
Beginning in 2007, the modified adjusted
gross income (MAGI) thresholds that help
determine whether your traditional IRA
contribution is deductible will be subject to
cost-of-living adjustments.
Increased Roth IRA Eligibility
Roth IRA eligibility depends in part on
your MAGI. Starting with the 2007 tax
year, these income limits are subject to
cost-of-living adjustments, allowing you to
contribute to a Roth IRA even as your
income increases.
You may be eligible to move your traditional
IRA assets to Roth IRAs by conversion.
Income taxes apply, but earnings on the
converted assets are tax free upon
distribution from the Roth IRA.
There’s never been a better
time to instill in your children
the value of saving for the
future. Today’s individual
retirement accounts (IRAs)
offer even more ways for your
money to grow with higher
contribution limits, attractive
tax incentives, and more
flexibility to move money
between IRAs and employersponsored retirement plans.
You’ll also enjoy more
flexibility when taking
withdrawals.
You are eligible to convert if your MAGI
is $100,000 or less. This limit applies
to both single and married joint federal
income tax filers. A married individual
who files a separate income tax return is
not eligible to convert.
Effective in 2010, the $100,000 MAGI
limit and the joint filing requirement for
married individuals will no longer apply,
making conversions available to everyone.
Expanded Rollover Options
Effective for employer plan distributions
beginning January 1, 2008, you will be
able to directly roll distributions from
certain employer plans to a Roth IRA
using the conversion eligibility rules.