Roth IRA

Roth IRAs are designed to help individuals to save for their first home, higher education, and other qualified distribution reasons. Your nondeductible annual contributions are taken after taxes and qualified withdrawals are Tax Free.

Eligibility

Married Couples filing jointly with a combined income of up to $190,000 or single filers with income of up to $95,000.

Contributions

Every eligible taxpayer will be able to contribute up to $4,000 in 2005 and $4,000 in 2006 per year (in coordination with Traditional IRA contributions). Contributions can also be made after age 70^1/2. A person who is 50 years old or older can do a catch-up contribution of $1,000 in 2006 and $500.00 in 2005.

Qualified Distributions

Withdrawals after 5 years are tax free and penalty free if used for any of these qualified distributions:

• Higher Education
• A first home (up to $10,000)
• Age 59^1/2
• Death
• Disability

No age 70^1/2 minimum distribution is required.

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