What makes the Roth IRA unique? Unlike the Traditional IRA, there is no 70½ age limit on making contributions to a Roth IRA. You simply need to have earned income equal to the amount you contribute up to a maximum, which is based on your modified adjusted gross income.   The maximum contribution is reduced for individuals with a modified adjusted gross income of $95,000 ($150,000 for married couples filing a joint return).   Roth IRA contributions may not be made by individuals with a modified adjusted gross income of more than $110,000 ($160,000 for married couples filing a joint return).

How much can I contribute? The maximum amount for 2006 and 2007 is $4,000. Individuals age 50 and older may be eligible for a higher contribution limit of $5,000 under the "catch up" provisions.

Why should I contribute to a Roth IRA  if I can't take a deduction? Since the money you contribute to a Roth IRA has already been taxed, the principal amount is never subject to taxes or penalties when withdrawn as long as you stay within certain guidelines. This retirement savings vehicle also allows the money you contribute to grow tax-deferred. If you do not withdraw any of the earnings until you have had a Roth IRA for at least five years and you satisfy one of the qualifying events, those tax-deferred earnings become tax-free.

Can I take a tax credit for my IRA contribution? Eligible individuals that meet certain income limitations may qualify for a tax credit of up to $2,000. Please consult your tax advisor.

When can I use my Roth IRA assets? If you satisfy two conditions, you may make tax-free and penalty-free withdrawals from your Roth IRA. First, a Roth IRA must have been open for a minimum of five years. Second, the withdrawal must be made after reaching age 59½, death, disability, or a first-time home purchase (i.e., "qualified distributions"). While you may take distributions from your Roth IRA at any time, distributions that are not qualified distributions are subject to taxes (and in some cases early distribution penalties) to the extent they exceed your aggregate contributions to Roth IRAs.

Can I move money from my Traditional IRA to my Roth IRA? Yes. There are specific rules that govern the process of converting funds from a Traditional IRA to a Roth IRA. Please consult your tax advisor.

Am I ever required to take funds from my Roth IRA? Unlike the Traditional IRA, there are no required minimum distributions at age 70½. Your dollars can continue to grow until you need them. There are special distribution requirements when these plans pass to your beneficiaries.