Guest twokatmew Posted October 25, 2005 Share Posted October 25, 2005 Hello, I have been paying into my 403b account through my employer for many years now. (They match 200%, so it's a great deal.) This year I opened a Roth IRA in addition to my 403b deposits. However, a surgery gone bad landed me on disability (insurance provided through my employer) part-way into 2005. I expected to go back to work this calendar year, but I now find it isn't going to happen. Further, my doctor is unsure if I will go back to work in 2006. Because my employer pays the premiums on this disability policy, I pay federal and state income tax on the disability income, but I do not pay medicare or social security tax. My question is that if it turns out that I remain on disability through 2006, will I be ineligible to make deposits to my Roth IRA in 2006? Further, does it make a difference if I start receiving social security disability? (My employer's disability policy requires that I apply for SSDI, which I did, but I was denied and have an appeal pending. As my employer's policy is coordinated, any income I ultimately receive from SSDI will reduce what I receive from my employer's insurance.) One other question.... Let's assume I am not eligible to make deposits to my Roth IRA while on disability. If I make desposits to my Roth IRA in 2006 expecting to return to work before the end of the year, and I end up not working in 2006, what happens? I know I would have to retract those deposits, but is there any penalty for doing so? Or does that depend on the investment company? (My account is with Vanguard.) And finally, can anyone point me to a source for all the Roth IRA rules and regulations? Thanks! Link to comment Share on other sites More sharing options...
Appleby Posted October 27, 2005 Share Posted October 27, 2005 One source IRS publication 590 at www.irs.gov You can make the Roth IRA contribution as long as you receive compensation for the year…contribution limit the lesser of 100 percent of compensation or $4,000--$4,500 if you are at least age 50 by year-end. 590 defines compensation for purposes of making an IRA contribution Life and Death Planning for Retirement Benefits by Natalie B. Choatehttps://www.ataxplan.com/life-and-death-planning-for-retirement-benefits/ www.DeniseAppleby.com Link to comment Share on other sites More sharing options...
Guest twokatmew Posted October 27, 2005 Share Posted October 27, 2005 Thanks so much!! Link to comment Share on other sites More sharing options...
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