Can’t Contribute Directly To A Roth IRA? Don’t Worry, You Can Still Make Roth Contributions.

Tens of millions of taxpayers have either just filed their 2011 tax returns or have filed for an extension.  Many of these same taxpayers discovered that they were prohibited, for one reason or another, from directly making Roth IRA contributions.  For those who file their taxes as Married Filing Separately (MFS), the taxpayer is prohibited from making Roth IRA contributions directly if he or she has Adjusted Gross Income (AGI) of greater than $10,000.  Further, some taxpayers are unable to make Roth IRA contributions if their AGI is too high or if they are eligible to contribute to a qualified retirement plan provided by his or her employer.

If you really want to make Roth IRA contributions, there is a way to work around these restrictions.  By making a non-deductible IRA contribution (i.e., an IRA contribution that provides no present tax deduction or beneficial tax treatment) and then converting that non-deductible IRA contribution to a Roth IRA, taxpayers are able to work around the Roth IRA direct contribution restrictions.  If done correctly, at the end of the day, you are left with a Roth IRA contribution with all of the tax benefits you would have received had you been able to set up a Roth IRA and fund it directly without any penalty or extra taxes.

Tax laws are confusing and do not always make logical sense; however, these same laws can be used to benefit you and your family.  Visit or call (614) 888-4911 today to learn more about tax planning from the lawyers at Kohler & Smith Co., LPA.


About Kohler & Smith Co., LPA

We are a general practice law firm serving Ohio, Florida, and Pennsylvania. Since 1978, Kohler & Smith Co., LPA has provided representation for its clients' legal and tax matters. The attorneys at Kohler & Smith Co., LPA focus their practice on Estate Planning, Elder Law, Probate, Business/Corporate Matters, Real Estate, Taxation, Lottery Law, Receivership, and Civil Litigation.
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