Name: Date: Period:

T9 – Traditional IRAs

Location / Speed / Mission /
1. Introduction / Slow Down, Write / a.  Why is a Traditional IRA an excellent retirement investment plan?
2. Eligibility Requirements / Slow Down, Write / a.  Who can establish a traditional IRA?
b.  What types of compensation are eligible to fund a Traditional IRA?
c.  What types of institutions can offer IRAs?
d.  Is there a deadline each year for making contributions?
e.  What 2 basic documents must be given to the IRA owner?
3. Contributions / Stop, Think, Write / a.  What is the yearly participant contribution limit for the most recent year?
b.  What can be said about contributions made to a spousal IRA?
c.  What is a transfer and give some examples.
d.  How is a rollover different from a transfer?
e.  Where can a direct rollover originate from?
f.  What 3 factors determine whether a partial or full deduction can be made?
g.  Who, in general terms, is considered to be an active participant?
h.  Study Table 2. What is the deduction allowed for an individual whose tax-filing status is Single, with a MAGI of $50,000? Carlos and Anita file as Married Filing Joint, with a combined MAGI of $125,000. Carlos is maxed out in his employer’s 401k plan. What is his deduction allowed? Why do you think this is the case? Anita does not have another employer sponsored retirement plan. What is her deduction allowed?
i.  What kinds of investments can be held in IRAs, including collectibles?
4. Distributions / Slow Down, Write / a.  What is the penalty for taking a distribution from a Traditional IRA before the age of 59½?
b.  What would happen if a distribution was taken before age 59½ to pay for unreimbursed medical expenses, medical insurance, a first home, or qualified higher education expenses?
c.  Why do you think that rollover contributions are not subject to the early-distribution penalty?
d.  By what age must plan participants take their minimum required distributions?
e.  What is the penalty for not taking the RMD by the deadline?
8. Conclusion /
Read Quickly / a.  Missing from my notes…

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