HSBC Traditional IRAs deductible from 2006 income til 4/17/2007

Traditional IRAs

Traditional IRAs

Did you know earnings in your Traditional IRA are not subject to federal income tax until withdrawal? You may be able to deduct all or a portion of your Traditional IRA contributions (if you meet the requirements). And you can begin taking withdrawals from your Traditional IRA without any penalties when you reach age 591/2.

In addition, penalty free withdrawals can be taken for the following:

* You are using the withdrawal for a qualified first home purchase
* You are using the withdrawal to pay certain higher education expenses
* Certain conditions of unemployment or qualifying medical expenses
* The distribution was a result of disability or death

2006 Traditional IRA Eligibility Requirements:

* You are not age 701/2 in the year the contribution is made.
* You have earned income equal to the amount you contributed, up to a maximum of $4,000 ($8,000 combined for spouses if you file a joint return) per year.
* You may make an annual contribution to a Traditional IRA by the due date for your federal income tax return for the year. For tax year 2006, the deadline is April 17, 2007.

2006 Traditional IRA Contribution Limits

If you are not an active participant in an employer sponsored retirement plan, such as a 401(k), your entire contribution is tax deductible.

If you participate in an employer sponsored retirement plan, your Traditional IRA may be completely or partially deductible. Deductibility depends on the amount of your income.