To Roth or Not to Roth

    As the fall is now in full swing, its time to begin planning year end tax strategies.  There are a significant number of tax related issues to be addressed by taxpayers by December 31.  The most significant issue, of course, is the Roth IRA.

    The Roth IRA offers taxpayers an almost unbelievable investment opportunity.  A Roth IRA allows for the benefits of never paying taxes on future earnings and appreciation.  For younger taxpayers, this is an opportunity to convert a modest amount of money into a virtual tax free golden egg in retirement years.

    In addition, parents and grandparents should research the usefulness of education IRAs which allow for the formal establishment of educational expenses, also in potentially tax free trusts.

    The primary problem with the changes in 1997's tax law which established these new and innovative savings vehicles is that there is a significant amount of analysis required to determine if taxpayers qualify for the preferential treatment.  Therefore, every taxpayer may have a different strategy depending on personal circumstances.  Because of this fact, taxpayers should not wait too soon to begin analyzing their situation.

    In addition, while the income-tax free aspects of the new IRAs appear attractive, we must remember that any type of sales or value-added tax that may be implemented in the future would subject these monies to taxation.

Please contact us for information and help in obtaining an analysis of your status and the availability of setting up a Roth IRA.

Ph:  309.682.5144
or 
Email:  gary@martinandshadid.com