Bob asks:
After reading your post "Nondeductible IRA to Roth in 2010", I had this question.....
My wife and I are over 50 years of age. We do have retirement and deferred Comp at work. What is the dollar limit on how much we can put in the non deductible IRAs as we are not qualified to contribute in the traditional or ROTh IRA due to income limit? I retired on 6/30/2008 with an annual pention of $42,500 (paid monthly) for my lifetime. Can I rollover $21,250 of my pension from 2008 to IRA?
My reply:
Bob,
You are able to roll over your pension into an IRA as long as you do it before it is distributed. It sounds like that didn't happen, since you said 2008 and it's 2009. You can use your distribution to contribute to an IRA, but you're restricted to the yearly IRA contribution rules. If you were both over 50 as of 12/31/2008 then you can both make $6,000 non-deductible contributions ($12,000 in total - $6,000 for each of you) to your own Traditional IRA for 2008 and 2009.
You are able to roll over your pension into an IRA as long as you do it before it is distributed. It sounds like that didn't happen, since you said 2008 and it's 2009. You can use your distribution to contribute to an IRA, but you're restricted to the yearly IRA contribution rules. If you were both over 50 as of 12/31/2008 then you can both make $6,000 non-deductible contributions ($12,000 in total - $6,000 for each of you) to your own Traditional IRA for 2008 and 2009.
Talk to your plan administrator and they should be able to help you.
Best wishes,
Gina
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