Roth IRA contribution for 2012

[Bedrock]

sorry if this has been asked and answered many times before. If you haven't opened IRA account in 2012 is it possible to open one now and contribut for 2012?
Thanks

[interplanetjanet]

sorry if this has been asked and answered many times before. If you haven't opened IRA account in 2012 is it possible to open one now and contribut for 2012?
Thanks

Yes, for 2012. Not for 2102.

[runner9]

You can contribute anytime up until the end of April 15, 2013 for 2012 contribution.

[VictoriaF]

You can contribute anytime up until the end of April 15, 2013 for 2012 contribution.

And anytime up until the end of April 15, 2103 for 2102 contribution.

Victoria

[crowd79]

You can contribute anytime up until the end of April 15, 2013 for 2012 contribution.

And anytime up until the end of April 15, 2103 for 2102 contribution.

Victoria

Provided that government doesn't change the law, or better yet, earth doesn't get hit by an asteroid by then.

[runner9]

You can contribute anytime up until the end of April 15, 2013 for 2012 contribution.

And anytime up until the end of April 15, 2103 for 2102 contribution.

Victoria

Actually, April 15, 2103 will be a Sunday, so it will probably be up until the end of Monday, April 16, 2103.

[VictoriaF]

You can contribute anytime up until the end of April 15, 2013 for 2012 contribution.

And anytime up until the end of April 15, 2103 for 2102 contribution.

Victoria

Actually, April 15, 2103 will be a Sunday, so it will probably be up until the end of Monday, April 16, 2103.

Good catch. I'm pleased to get an extra day just when I need it.

Victoria

[grabiner]

You can contribute anytime up until the end of April 15, 2013 for 2012 contribution.

And anytime up until the end of April 15, 2103 for 2102 contribution.

Victoria

Actually, April 15, 2103 will be a Sunday, so it will probably be up until the end of Monday, April 16, 2103.

And DC observes Emancipation Day on April 16, so the deadline is April 17, 2103. (The same thing happened in 2012.)

[Bedrock]

thanks you all. 2012 not 2102 (fixed).

[Gemini]

Instead of starting another thread, I figured I might as well ask in here (hope you don't mind bedrock!)

1. How do I determine my eligibility for 2012 Roth? I recently received my two W-2 forms from the two gigs that I have had in 2012. Do I just add the wages columns from both and see if it below the limit?

2. Can Roth be used an emergency fund i.e. is there any penalty for withdrawing what you put in before you are older (not the gains)?

[runner9]

2. Yes, there is no penalty but you lose that 'space', you can't recontribute to it. e.g.: pull out 2012 contribution in 15 months it's gone, you can't add it back under that year.

[Default User BR]

Instead of starting another thread, I figured I might as well ask in here (hope you don't mind bedrock!)

1. How do I determine my eligibility for 2012 Roth? I recently received my two W-2 forms from the two gigs that I have had in 2012. Do I just add the wages columns from both and see if it below the limit?

It's really your modified adjusted gross income for the year that is important.

See: http://www.fairmark.com/rothira/modagi.htm


Brian

[Gemini]

Is there a way to calculate my AGI from the W2 forms? I am not familiar with a 1040 form.

From looking at the two W2 forms and adding the "wages, tips, other comp." column my total comes to 133,550.

[VictoriaF]

Is there a way to calculate my AGI from the W2 forms? I am not familiar with a 1040 form.

From looking at the two W2 forms and adding the "wages, tips, other comp." column my total comes to 133,550.

W2 forms do not show investment income, which is a part of the AGI, along with many other items.

Victoria

[JW Nearly Retired]

Is there a way to calculate my AGI from the W2 forms? I am not familiar with a 1040 form.

From looking at the two W2 forms and adding the "wages, tips, other comp." column my total comes to 133,550.

1040 is the income tax form. Have you never paid income tax before? You will now with this income. Suggest you get the free version of TaxAct and put the W-2 numbers in and other facts like if you are single or married and have dividends or interest and so on, and see what AGI is. It is very helpful to learn something about how income tax works.

http://www.taxact.com/

I think if you are single you might be in the Roth phase out region, but you need to put in all your data to be sure.
JW

[grabiner]

2. Can Roth be used an emergency fund i.e. is there any penalty for withdrawing what you put in before you are older (not the gains)?

Wiki article link: Roth IRA as an emergency fund

If you treat part of your Roth IRA as an emergency fund, then you should also invest that part of your Roth IRA as an emergency fund (in money-market funds or short-term bonds), and not count that as part of your retirement savings. You'll get the benefit of tax-deferred growth, and the money will already be in your retirement accounts if you don't need it in an emergency.

Since you might be in the range in which direct Roth IRA contributions are limited, you may need to make the contributions by using a Backdoor Roth IRA. You'll be able to see the numbers when you fill out your tax form.

[Toons]

Pros & Cons of using Roth IRA as emergency fund

http://www.mydollarplan.com/roth-ira-emergency-fund/

[grabiner]

Pros & Cons of using Roth IRA as emergency fund

http://www.mydollarplan.com/roth-ira-emergency-fund/

You can avoid two of the three cons: put money in the Roth IRA that would otherwise be in a bank account to make the emergency fund (so that you aren't sacrificing retirement savings), and keep that part of the Roth IRA invested as appropriate for an emergency fund, not in stock.

It is still true that it may take a few days to get the money out of the Roth IRA; you have to transfer the money to your bank account before you can write a check against it. You need some money that can be accessed immediately, via cash or check. But if your car needs a new engine, you can pay the repair shop with a credit card, and have time to withdraw from the Roth IRA before the credit-card bill is due.