Tax Free Retirement: There’s a way to retrieve tax-free income after you retire. Very few people know about a unique retirement plan that an save you thousands of dollars. But don’t think it’ll be easy to use this plan. There guide to the prize is a confusing maze.
The lowdown: The Roth IRA and Roth 401(k) plans are very similar to their counterparts, the plain old IRA and 401(k). With the regular IRA, you get an immediate tax deduction, but you have to pay income taxes when you withdraw money. With the Roth IRA and 401(k), you cannot get an upfront tax deduction. But you do not pay taxes on the money you withdraw. So how can this save you thousands of dollars?
Withdrawal: The Roth IRA and 401(k) saves you money when you withdraw. You don’t have to pay taxes when you withdraw money like you have to with a normal account. That saves you more money than the upfront Tax Break of the normal IRA and 401(K).
Opening one: If your job offers the Roth 401(k) program, you automatically qualify for it. But funding a Roth IRA is different. Qualifying will depend on how much money you make. To invest the full $5,000 in a Roth IRA you must make $159,000 if married filing jointly and $101,000 if filing single.
More Benefits: The Roth IRA and 401(k) have more benefits than saving you cash. For instance, with a regular IRA plan you have to withdraw money the April after you turn 70 ½. If you don’t, you’ll face a penalty fee. With the Roth IRA, you never have to withdraw money until you want to. You can even pass it along to your children.
Final Tip: Roth even affects your social security. You can have your social security check taxed less in retirement. That’s because withdrawals from Roths are excluded from the IRS’s calculations when they decide your taxable income. Depending on your situation, there are many benefits to trying the Roth IRA and 401(k) plans. So do your research and see if you qualify for big savings.
Now You Have The Smoking Gun…Use it!
Richard Close was an IRS-Hitman. He worked as a revenue officer for the IRS and his father was the head of the collections branch for 30 years; so it runs in the family. He left that behind and now he’s partnered with Tax Defense Network to help thousands of Americans with their tax problems. He gives the tips and tricks for you to fight the IRS and win! Visit him at: irs-hitman.blogspot.com or www.irs-tax-settlement-hq.com or contact: email email@example.com or 1-888-248-9058.
Article Source: EzineArticles.com/expert/Richard_Close/159875