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SeattleNative
- Senior Member - 1K
rated:
posted: May. 9, 2005 @ 1:37a 
In a unanimous decision authored by Justice Clarence Thomas and issued on April 4, 2005, the Supreme Court ruled that IRAs are among a debtor’s exempt assets shielded from creditors under the U.S. Bankruptcy Code (Title 11). Rousey v. Jacoway, 125 S. Ct. 1561 (2005).
The Supreme Court resolved a long-time dispute among legal professionals and financial experts, and emphasized the concept of a a "fresh start" for consumer debtors.
This is terrific news for ordinary consumers and Americans from all walks of life. |
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ellory
- Thrifty Member
rated:
posted: May. 9, 2005 @ 5:36a
Just to note, this ruling was about an IRA that had early withdrawal penalties.
Whether this ruling carries forward to Roth IRA's is unknown |
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flicken
- Thrifty Member
rated:
posted: May. 9, 2005 @ 11:20a
Clarified by LH2004, please ignore/delete. |
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LH2004
- Frivolous Member
rated:
posted: May. 9, 2005 @ 12:23p
ellory said:Just to note, this ruling was about an IRA that had early withdrawal penalties.
Whether this ruling carries forward to Roth IRA's is unknownUnknown but irrelevant. Under BAPCPA, the 2005 bankruptcy reform law, all IRA's are now protected (up to $1 million of contributions and an unlimited amount of rollovers). See, e.g., this explanation.
This kind of discussion doesn't really belong in the FAQ thread, but I thought it was important to prevent future misunderstandings. |
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Count26
- Senior Member - 2K
rated:
posted: Jul. 10, 2005 @ 9:00p
where does one open up a Roth IRA? I am definitely want to start putting away money somewhere else besides a savings account. TIA |
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Count26
- Senior Member - 2K
rated:
posted: Jul. 11, 2005 @ 2:26a
whats the difference between a roth and a regular IRA? |
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whodini
- Senior Member - 1K
rated:
posted: Jul. 11, 2005 @ 9:33a
LH2004 said:Whether this ruling carries forward to Roth IRA's is unknownUnknown but irrelevant. Under BAPCPA, the 2005 bankruptcy reform law, all IRA's are now protected (up to $1 million of contributions and an unlimited amount of rollovers). See, e.g., this explanation.
Thanks the info. The linked article suggests keeping 401k rollovers separate from IRA contributions for maximum protection. Sounds like good advice to me. |
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fortezza
- Senior Member
rated:
posted: Aug. 29, 2005 @ 7:55p
Count26 said:whats the difference between a roth and a regular IRA?
Regular( traditional ):
Contributions are Pre-tax Dollars
Contributions are Tax Deductible ( within restrictions )
Early distributions incur penaltiess ( exemptions exist )
Gains are taxed
Roth:
Contributions are After-tax dollars
Contributions are not Tax Deductible
Early distributions of contributions are not taxed, ever. Gains,etc do incur penalties. ( exemptions exist )
Gains are not taxed
Quick overview for you. |
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slimcustomer
- Senior Member - 1K
rated:
posted: Nov. 23, 2005 @ 7:54a
Bump for end of the year tax planning. |
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rezmo
- New Member
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posted: Nov. 23, 2005 @ 9:20a
Can anyone recommend the best institution to open a roth with? This is going to be my foray into the investing world, and I am unsure of what my transaction habits will become over the years. I am 24, and will hopefully be maxing out my roth for years to come. |
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skiter53
- Member
rated:
posted: Dec. 2, 2005 @ 10:25a
rezmo said:Can anyone recommend the best institution to open a roth with? This is going to be my foray into the investing world, and I am unsure of what my transaction habits will become over the years. I am 24, and will hopefully be maxing out my roth for years to come.
I too am trying to decide where to open my Roth IRA. After doing some quick research, I think it depends on what type of investing you are going to do w/ the money in your account. For example, if you intend on actively buying and selling stocks, a roth IRA with a discount online broker (Ameritrade, etc.) would be a better idea. On the other hand, if you intend on purchasing mutual funds, you may want to go with a mutual fund company that offers the funds you want. I hope that helps.
Does anyone have any suggestions as to which specific institutions would be best for any given investment method (which is best for active trading, etc.)? |
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sedaps
- Member
rated:
posted: Dec. 2, 2005 @ 4:45p
I currently use Firstrade (discount broker) as they have no charge for no load mutual funds and free dividend reinvesting. Also allows me to use ACH to send money to them. No complaints so far!
I also have a scottrade account but since they started charging a fee for NL funds, i stopped using it. |
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ArnoldRimmer
- Senior Member - 1K
rated:
posted: Jan. 23, 2006 @ 8:21a
In case someone already posted the idea, I apologize. If you contributed to any retirement account, such as 401k, IRA (traditional or Roth), and your income falls into certain categories (see 1040 or 1040A books and Form 8880 for details), $25000 AGI MAX for single or $50000 AGI for couple, you may be eligible for a tax credit (line 51 on 1040 or line 32 on 1040A)
The MAX credit will be $1000 or your Total Tax Liability, whichever smaller. |
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ProBanker
- Senior Member
rated:
posted: Feb. 9, 2006 @ 4:35p
I have a ROTH IRA that was opened in 1999 with $2000. Since then I have made $750 in contributions...that was over 2 years ago. Currently it has approx $1500.
I already have a 401k with my employer that is kicking butt, as well as a stock purchase plan. Both the SPP and 401K are deducted from my paycheck.
Honestly, I dont see myself EVER making any more contributions to the ROTH and I could REALLY use the money right now. My gf put in her resignation for her part time job because she is starting an internship at the end of this month.
What kind of tax/penalties would I face if I closed the ROTH? Would they simply deduct the tax/penalties from the ROTH account...or would it affect me later at the end of the 2006 tax year? TIA |
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Kempman
- Senior Member
rated:
posted: Feb. 9, 2006 @ 4:51p
Look at IRS Publication 590, available on irs.gov. Without looking at it, I think you can withdraw your contributions penalty-free. Your earnings will be taxed when you file your 2006 return. I don't think there are any penalties.
That said, if possible, you should try to maintain your Roth and max it out if you can. The tax benefits are incredible. |
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ProBanker
- Senior Member
rated:
posted: Feb. 9, 2006 @ 5:24p
Kempman said:...Your earnings will be taxed when you file your 2006 return. I don't think there are any penalties...
Thanks for the info, I found the site: http://www.irs.gov/publications/p590/ch02.html#d0e9969
So its a 10% tax on early non qualified distributions. If they dont tax it when I close it, how do I show it as "earnings" on the 2006 return? |
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LH2004
- Frivolous Member
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posted: Feb. 9, 2006 @ 7:23p
ProBanker said:So its a 10% tax on early non qualified distributions.No, there is no tax or penalty on other than on earnings. From what you've said, your Roth IRA doesn't have any. |
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wdsaltman95
- Cranky Member
rated:
posted: Feb. 9, 2006 @ 8:41p
ProBanker said:I have a ROTH IRA that was opened in 1999 with $2000. Since then I have made $750 in contributions...that was over 2 years ago. Currently it has approx $1500.
Like Kempman, I would encourage you to keep funding the Roth, but we certainly don't know all of your facts and only you can determine what is best for your situation. Given the figures you list, if you do cash out, in case you didn't already know, you may be able to deduct some of your loss. If this is your only Roth, you withdraw all the funds and you itemize, you can deduct the loss as a miscellaneous itemized deduction subject to the 2% floor. |
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ProBanker
- Senior Member
rated:
posted: Feb. 10, 2006 @ 1:20p
Great information, thanks everyone |
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