*Applies to individuals whose spouses are covered by a workplace plan but are not covered themselves.
Roth IRA: Eligibility of Contributions Contributions made to a Roth IRA are not deductible, unlike contributions made to a traditional IRA, and there is no age restriction on making contributions. An individual may contribute up to $5,000 to the Roth IRA, subject to income phase-out limits.
Status
Adjusted Gross Income
Deduction
Married
$0 – 166,000 $166,001 – 176,000 More than 176,000
$5,000 Maximum Partial None
Single
$0 – 105,000 105,001 – 120,000 More than 120,000
$5,000 Maximum Partial None
Roth IRA Rollover
Status
Adjusted Gross Income
Deduction
Married
$0 – 100,000 More than 100,000
Eligible Not Eligible
Single
$0 – 100,000 More than 100,000
Eligible Not Eligible
A traditional IRA may be rolled over (or simply converted) into a Roth IRA if adjusted gross income is not more than $100,000. (This applies to both single and joint filers.) In 2010, there will be no income limit for conversions.
Catch-Up Contributions If you have either a traditional or a Roth IRA and attain age 50 or older during the tax year, an additional $1,000 may be contributed.
Social Security, Medicare and Self-Employment Taxes
For 2009, you will pay Social Security and/or self-employment tax on your wages up to $106,800. For wages more than $106,800, you will pay only the Medicare portion of the tax. Self-employed individuals are allowed an income tax deduction for 50% of the self-employment tax.
Social Security
OASDI
Medicare
Total
Employees
6.20%
1.45%
7.65%
Self-Employed
12.40%
2.90%
15.30%
Social Security Earnings Test
Worker Age
62–before FRA
Attain FRA in 2009*
Full Retirement Age
Limit
$14,160
$37,680
No Limit
*Period before the month you attain FRA.
Income above the $14,160 limit is lost at the rate of $1 for every $2 earned. $1 is lost for every $3 above the $37,680 limit.
Monthly Social Security Benefits at Full Retirement Age To receive an estimate of your Social Security benefits, contact the Social Security Administration at 800-772-1213.
Your Age in 2009
Who Receives Benefits
Your Earnings of $50,000
Your Earnings of $106,800 and Up
66*
You Spouse
$1,653 826
$2,323 1,161
65
You Spouse
1,661 830
2,346 1,173
64
You Spouse
1,667 833
2,336 1,183
63
You Spouse
1,700 850
2,426 1,213
62
You Spouse
1,675 837
2,403 1,201
61
You Spouse
1,677 838
2,417 1,208
55
You Spouse
1,685 847
2,456 1,228
50
You Spouse
1,170 855
2,477 1,238
*For people born in 1942, the FRA is 65 and 10 months.
Trust and Estate Income Tax Rates
Taxable Income
Pay
Percentage of Excess
Of Amount Above
Not more than $2,300
N/A
15%
$0
2,300 – 5,350
$345
25
2,300
5,350 – 8,200
1,107.50
28
5,350
8,200 – 11,150
1,905.50
33
8,200
More than 11,150
2,879
35
11,150
Estate Tax Schedule: Taxable Estate and Tax before Credit
More Than
But Not More Than
Pay
Plus %
On Excess More Than
$0
$10,000
$0
18%
$0
10,000
20,000
1,800
20
10,000
20,000
40,000
3,800
22
20,000
40,000
60,000
8,200
24
40,000
60,000
80,000
13,000
26
60,000
80,000
100,000
18,200
28
80,000
100,000
150,000
23,800
30
100,000
150,000
250,000
38,800
32
150,000
250,000
500,000
70,800
34
250,000
500,000
750,000
155,800
37
500,000
750,000
1,000,000
248,300
39
750,000
1,000,000
1,250,000
345,800
41
1,000,000
1,250,000
1,500,000
488,300
43
1,250,000
1,500,000
2,000,000
555,800
45
1,500,000
2,000,000
–
780,800
45
2,000,000
Estate Tax Credit In 2002, the applicable credit amount began to gradually increase and will continue until estate taxes are totally repealed in 2010. In 2009, the applicable exclusion amount is $3,500,000.
Tax Credit
$1,455,800
Equivalent Estate
$3,500,000
Lifetime Gift Tax Credit
2009 and Later
$1,000,000 (Not Indexed)
Annual Exclusion for Gifts
2009
$13,000
Financial Planning Tables
Uniform Lifetime Table For the majority of IRA participants, the following table is used for determining a participant's required minimum distributions (RMDs). There is an exception when a spousal beneficiary is more than 10 years younger than the participant and is the sole beneficiary on January 1. In this case, a different table is used. To calculate your RMD, first find the age you will turn in 2009 and the corresponding applicable divisor. Then divide the prior year-end balance of your IRA account by the divisor. The resulting number is the dollar figure you will need to remove from your IRA to meet your RMD for the current year.
For example, if you are now 82, your applicable divisor is 17.1. If the balance in your IRA as of December 31 of last year was $235,000, divide that amount by 17.1. The result is $13,742.69. This is the amount of your RMD for the current year.
Note: RMDs have been suspended for the tax year 2009 for participants and beneficiaries.
Age
Applicable Divisor
Age
Applicable Divisor
Age
Applicable Divisor
70
27.4
86
14.1
102
5.5
71
27.4
87
13.4
103
5.2
72
25.6
88
12.7
104
4.9
73
24.7
89
12
105
4.5
74
23.8
90
11.4
106
4.2
75
22.9
91
10.8
107
3.9
76
22
92
10.2
108
3.7
77
21.2
93
9.6
109
3.4
78
20.3
94
9.1
110
3.1
79
19.5
95
8.6
111
2.9
80
18.7
96
8.1
112
2.6
81
17.9
97
7.6
113
2.4
82
17.1
98
7.1
114
2.1
83
16.3
99
6.7
115+
1.9
84
15.5
100
6.3
85
14.8
101
5.9
Taxable Yield Equivalents
Tax-Exempt Yields
15%
25%
28%
33%
35%
4.00%
4.71%
5.33%
5.56%
5.97%
6.15%
4.5
5.29
6.00
6.25
6.72
6.92
5.0
5.88
6.67
6.94
7.46
7.69
5.5
6.47
7.33
7.64
8.21
8.46
6.0
7.06
8.00
8.33
8.96
9.23
6.5
7.65
8.67
9.03
9.70
10.00
7.0
8.24
9.33
9.72
10.45
10.77
7.5
8.82
10.00
10.42
11.19
11.54
8.0
9.41
10.67
11.11
11.94
12.31
Present Value of a Lump Sum What if you know you will need $10,000 accumulated 10 years from now? How much money do you need to invest today at an average interest rate of 8% to obtain your goal? Looking at the table below, go to 10 years and then across to 8%. You see that $0.463 invested today at 8% should yield $1 in 10 years. Since you want $10,000, multiply $0.463 by $10,000 to arrive at $4,630.
Years
5%
6%
8%
10%
12%
10
0.614
0.558
0.463
0.386
0.322
20
0.377
0.312
0.215
0.149
0.104
30
0.231
0.174
0.099
0.057
0.033
40
0.142
0.097
0.046
0.022
0.011
Future Value of a Lump Sum If you invest $10,000 at an interest rate of 8%, how much will your investment be worth in 10 years? By referring to the table, you find that $1 invested today at 8% would grow to $2.159 in 10 years. Since you invested $10,000, multiply $2.159 by $10,000, giving you $21,590.
Years
5%
6%
8%
10%
12%
10
12.578
13.181
14.487
15.937
17.549
20
33.066
36.786
45.762
57.275
72.052
30
66.439
79.058
113.283
164.494
241.333
40
120.8
154.762
259.057
442.593
767.091
The information provided in these web pages is based on internal and external sources believed reliable; however, the accuracy and completeness of the information is not guaranteed and the figures may have changed since the time of printing. Examples are hypothetical illustrations and not intended to reflect the actual performance of any particular security. Please consult your tax advisor for questions relating to your individual situation.
Raymond James financial advisors may only conduct business with residents of the states and/or jurisdictions for which they are properly registered. Therefore, a response to a request for information may be delayed. Please note that not all of the investments and services mentioned are available in every state. Investors outside of the United States are subject to securities and tax regulations within their applicable jurisdictions that are not addressed on this site. Contact your local Raymond James office for information and availability. | finra.org | sipc.org
Securities offered through Raymond James Financial Services, Inc. Member FINRA/SIPC, and are:
Not deposits
Not insured by FDIC or any other governmental agency
Not guaranteed by the financial institution (or name of financial institution)
Subject to risk, may lose value
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