Roth IRA Calculator

A Roth IRA is a great way to save money for retirement. The money that is deposited in a Roth IRA can be used tax-free for other expenses, as well. This makes this savings option very versatile. A Roth IRA Calculator can be helpful in determining the viability of converting a traditional IRA to a Roth IRA and there are also Roth IRA Calculators that will calculate you post-tax income from a Roth IRA.

Using a Roth IRA calculator is an excellent tool for planning for your future. These calculators are available on the internet on calculator sites and most major investment sites also contain a variety of calculators.

Here are some questions that people often need the answers to as they are contemplating making IRA investment decisions.

Can an IRA be rolled over into a qualified retirement plan (e.g., 401(k), profit-sharing, etc.)?
An IRA can be rolled over into a qualified retirement plan, assuming the qualified retirement plan has language permitting such rollovers.

Can an IRA accept rollovers from a qualified retirement plans?
Provided the IRA document permits rollovers, almost any type of plan distribution can be rolled over into it.

Are in-service distributions allowed from an IRA-based plan (e.g., SEP, SARSEP or SIMPLE IRA plan)?
There are no prohibitions on distributions from IRA-based plans. A participant can take distributions at any time. However, in addition to the distribution being taxable, it may be subject to a 10% additional tax if the participant has not reached age 59 1/2. If the distribution is taken in the first 2 years of participation in a SIMPLE IRA plan, the additional tax is increased to 25%.

Are hardship distributions allowed from an IRA-based plan?
As in-service distributions are allowed, so are “hardship” distributions, subject to the same conditions.

Must distributions be made to IRA-based plan participants who are over age 70 1/2, if they are still working? What about to the owner of the company?
Both the owner and any employees over age 70 1/2 must take required minimum distributions. Unlike qualified plans (e.g., 401(k), profit-sharing, etc.), there is no exception for non-owners who have not retired.

These are just a few of the questions that an individual may have as they are making decisions about the retirement and investment portfolio. Both Traditional and Roth IRAs should be part of any diversified portfolio.