So every year, you get the opportunity to put in a certain amount of money into your IRAs and/or Roth IRAs. And many of our clients have this funding set on auto pilot, so to speak. Specifically, they have certain amount of money coming out of the bank account and into their IRAs or Roth IRAs on a regular basis. But if you are an entrepreneur, you may not necessarily know until later in the year if funding one is more advantageous than the other, given the variables in your income. That’s why you are allowed to wait on funding these buckets until your tax filing deadline. This is usually on or around April 15 every year, although in 2020 it was delayed by three months to deal with the fallout from the pandemic. At any rate, you can fund your Roth IRA on a regular basis, early, or even after the tax year is done and before your filing deadline.
Any opinions are those of Tim Weddle and not necessarily those of Raymond James. Investing involves risk and you may incur a profit or loss regardless of strategy selected. Past performance does not guarantee future results. Like Traditional IRAs, contribution limits apply to Roth IRAs. In addition, with a
Roth IRA, your allowable contribution may be reduced or eliminated if your annual income exceeds certain limits. Contributions to a Roth IRA are never tax deductible, but if certain conditions are met, distributions will be completely income tax free.