IRA for 2008
I am very confused right now as to what to do with the 2008 IRA contributions.
I have a balance of $2500 in my 2008 IRA account. And I had planned to add $500 each month. But I am not sure if I would qualify to make IRA contributions this year. Last year I worked only from August. Due to our joint tax return, I qualified to make only partial contribution of $3900 towards 2007 IRA which I did. This year I will be working the entire year and I am starting to think if I would qualify even for partial contribution this year.
My question is if I end up not qualified to contribute this year, can I take the money out without any penalties? I am hoping one of my readers could clarify this issue for me.
Thanks in advance.
Yes, you can take out the deposit if by year end (or 4/15/09) find that you were not eligible to make the deposit. No penalty, providing you withdraw the excess deposit along with the accumulated interest on the excess amount.
Joe
But a representative at Fidelity claims that there will be penalty if I withdraw the amount. Can you point me to some article which I can refer to when I talk to them?
1) Pull a copy of Pub 590 from http://www.irs.gov/pub/irs-pdf/p590.pdf
2) Go right to bottom of p32 for an explanation in plain english.
3) add me to your blogroll ’cause I am so helpful.
Joe
Thanks a lot. I added you to my blogroll. I assumed it was already there. Sorry about that.
More than anything, I am now curious what Fidelity has to say, now that you are armed with an IRS publication to back up your request/question. I’m surprised at them, this is something they should know cold.
Joe