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Traditional IRAs
Deductible Contributions
Traditional IRAs offer tax-deferred growth and contributions that may be tax-deductible. If neither
you nor your spouse participates in an employee-sponsored retirement plan, you can deduct the full
amount of your traditional IRA contribution regardless of your income. If you do participate in
an employer-sponsored plan, your traditional IRA contribution is deductible only if your adjusted
gross income falls within the following limits:
| 2002 |
Fully Deductible |
Partially Deductible |
| Single |
Up to $34,000 |
$34,000 to 44,000 |
| Married, filing jointly |
Up to $54,000 |
$54,000 to 64,000 |
Investors may contribute to both Traditional and Roth IRAs; however, the total contribution amount
for both accounts combined cannot exceed the maximum annual contribution limit.
Withdrawals
Traditional IRAs are tax-deferred, so you don’t pay taxes on the money you earn until you begin
to make withdrawals, typically at retirement when your tax bracket may be lower. You generally
cannot make withdrawals from a traditional IRA before age 59½ without paying the taxes due and
a 10% early withdrawal penalty. There are some exceptions. IRA savings can be withdrawn penalty-free for:
- The purchase of a first home
- To pay higher education expenses
- To cover some medical expenses
IRA savings may also be withdrawn penalty free in the case of death or disability.
If you’re planning to retire early, withdrawals may also be made penalty-free prior to age 59½
if you take a series of substantially equal periodic payments.
Investing in an Armada No Annual Fee IRA is easy. You can order an IRA kit, download a
Traditional IRA Application, or
you can invest online, right now.
  
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