What are the benefits of opening a Roth IRA?

The most often mentioned benefit of a Roth IRA is tax-deferral: your contributions and the earnings on those contributions grow tax-deferred over the life of the account. Plus, if you meet IRS qualifications, all monies withdrawn at retirement can be done so tax-free.

Do I need to deposit money immediately to open an IRA account?

No. Your BUYandHOLD IRA account will be open as soon as you complete your application. But you must keep in mind that the April 15th deadline for IRAs is for opening and funding your account.

Can anyone open a Roth IRA?

No. There are some income restrictions for Roth IRAs.

• Individuals earning less than $99,500 can make a full $5,000 contribution. A partial contribution can be made for those with incomes between $99,500 and $114,500.
• Married couples earning less than $156,500 can make a full $5,000 contribution for each spouse, as long as either or both spouses have $5,000 in earned income.
• Individuals earning between $99,500 and $114,500 can make a partial contribution, with those earning over $110,00 being ineligible to contribute.
• Married couples earning between $156,500 and $166,500 can make partial contributions, with those earning over $166,500 being ineligible to contribute.

If you are age 50 or older, you can contribute an additional $1,000 as a catch-up contribution.

Can I make a contribution to both a Traditional IRA and a Roth IRA?

If you meet the eligibility requirements for both Traditional and Roth IRAs and you want to open both, you may. However, your total contribution between both accounts can only be $5,000, unless you are age 50 or older, and you can contribute $6,000.

Can I make a contribution with cash or securities?

No. Contributions to a Roth IRA can only be made in cash.

How can I fund my Roth IRA?

At BUYandHOLD we offer several ways to fund your Roth IRA:

• Set up BUYandHOLD Instant Deposit to have your contribution moved electronically from your savings or checking account to your BUYandHOLD account. Click here to set up BUYandHOLD Instant Deposit.
• Send a check for your contribution, made payable to BUYandHOLD, along with our Check Deposit Slip. Follow the mailing instructions found on the slip.
• You can also transfer assets from an IRA you hold at another financial services firm. This will be considered a transfer of existing assets, and as such will not be reported as a contribution to your IRA. To transfer all or part of the existing assets you hold in an IRA at another financial services firm, go to the Maintenance area in the "View Your Account" section of our site and click on Printable Forms. Choose the Brokerage Account Transfer Form, or click here, then print the form, complete it and return it to BUYandHOLD as per the instructions on the form.

How does the IRS define earnings?

According to the 1999 IRS Publication 590 "earnings" is compensation earned from wages, salaries, tips, professional fees, bonuses, and other amounts you receive for providing personal services that are shown in box 1 of Form W-2. This includes commissions, earnings from self-employment, and alimony. This does not include earnings and profit from property, such as rental income, interest income, and dividend income. Also not included are pension and annuity income, deferred compensation, and income from a partnership. It also does not include any amounts that you exclude from declaring as income, such as foreign earned income and housing costs.