For the 2010 tax year, you can contribute up to $5,000 to an IRA and if you’re age 50 or older in each tax year, you can make an extra $1,000 catch-up contribution. Make your 2010 contributions anytime between January 1, 2010 and April 15, 2011.
You can continue to make 2009 tax year contributions until April 15, 2010. For the 2009 tax year, you can contribute up to $5,000 to an IRA and if you’re age 50 or older in each tax year, you can make an extra $1,000 catch-up contribution.
Individual Retirement Accounts (IRAs) are great tax-favored ways to save for
retirement. With a
Roth IRA, earnings
grow tax free and are also tax free when you make qualified withdrawals. With a
traditional IRA, your earnings grow tax deferred, so you won’t owe
income taxes until you make withdrawals. And if you’re eligible, your
contributions are tax deductible.
How do you decide whether an IRA is right for you and which type of IRA is appropriate?
The answer to this question really depends on what type of contribution you’re eligible for and your specific financial situation. Our IRA Calculators will help you determine which IRA you’re eligible for and then help you evaluate which type is best for you. And our IRA Center Articles will teach you what you need to know about IRAs, their tax advantages, contribution limits, and withdrawal rules.