Traditional IRA
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• You can establish and make contributions to an IRA if you received taxable compensation during the year and have not yet reached the age of 70 1/2 by the end of the year.
• Contributions may be made up to the lesser of 100% of compensation or $4,000 ($5,000 for individuals over the age of 50) in 2007 and $5,000 in 2008 ($6,000 for individuals over the age of 50 in 2008).
• If you maintain multiple IRA accounts, the maximum contribution to all of the accounts can not exceed these totals.
• An IRA for any year may be opened and funded at anytime before the due date for filing your tax return, not including any extensions.

Roth IRA
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• Individuals with adjusted gross income (AGI) up to $99,000 and married couples filing jointly with AGI up to $156,000 can make full contributions to a Roth IRA. Married couples filing single returns can only contribute if their adjusted gross income is under $10,000.
• The total amount you may contribute to a Roth IRA for any taxable year cannot exceed the lesser of $4,000 in 2007, and $5,000 in tax years 2008. Individuals over the age of 50 can contribute $5,000 in 2007 and $6,000 for tax years 2008.
  
• If you maintain a Traditional IRA, the maximum contribution to your Roth IRA is reduced by any contributions made to your Traditional IRA.

• Unlike contributions to a Traditional IRA, contributions to a Roth IRA are not deductible.
• Distributions from a Roth IRA are tax-free if held for at least five years and used for a qualified purpose such as reaching age 59 1/2, disability, first home purchase, or death.
• Contributions may be made after age 70 1/2.
• No required minimum distribution rules apply.
• Traditional IRAs may be converted to Roth IRAs provided the taxpayers adjusted gross income is under $100,000.

Rollover IRAs
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• If you received an eligible rollover distribution from your IRA, employer's qualified pension, profit sharing or stock bonus plan, annuity plan, or tax sheltered annuity plan (403(b) plan), you can roll over all or part of it into an IRA.
• Rollover contributions must be made by the 60th day after the day you receive a distribution from your IRA or employer's plan in order to continue their tax-deferred status.

Small Business Plans

SEP IRA
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• Any employer, including a sole proprietor with no employees, can establish a SEP for the benefit of all eligible employees. The owner of the business is also considered an employee who is eligible to receive a SEP contribution.
• Up to the lesser of 25 percent of compensation or $41,000 can be deposited annually for an eligible employee (or such other amount provided by law).
• An eligible employee who receives a SEP contribution can also make an annual IRA contribution of the lesser of 100% of earned income up to $4,000 for 2005-2007.
• A SEP IRA may be opened and funded up until the employer's tax filing deadline, including extensions.

SIMPLE IRA
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• You are eligible to establish and maintain a SIMPLE IRA plan only if you employed 100 or fewer employees last year that earned $5,000 or more in compensation from you during the year. Also, you may not maintain any other qualified retirement plan in which your employees currently accrue benefits.

Contributions:
Employee Salary Deferral Contributions

• Employees may contribute up to: $10,500 in 2007. Future increases will be based cost of living adjustments.
• Eligible individuals over age 50 may make catch up contributions of up to: $2,500 in 2007. Beyond 2007, catch up contributions will be based on cost of living adjustments.

Employer SIMPLE Contributions
Employers are required to make contributions to the SIMPLE IRA account of all employees by using one of the following contribution formulas:

• Match each eligible employee’s contribution dollar-for-dollar up to 3% of the employee’s compensation; or,
• Elect to make a matching contribution of up to 3% of compensation in any two of the last five calendar years, including the year the match is reduced. The reduction may not be less than 1% of each employee’s compensation; or,
• In any calendar year, the matching contribution may be replaced with a 2% contribution to all employees. This is called a non-elective contribution and must be made to all eligible employees regardless of whether or not they contribute through salary deferrals.

Educational Savings Account
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• Any Individuals who fall within certain income limits may make contributions up to $2,000 per year on behalf of a child under the age of 18.
• Single tax filers with annual adjusted gross income (AGI) up to $95,000 or married couples with AGI up to $190,000 are eligible to make the maximum annual contribution to a Coverdell ESA.
• The amount that may be contributed is gradually reduced to zero at AGI levels between $95,000 and $110,000 for single filers and between $190,000 and $200,000 for joint filers.

Tax Deferred Earnings / Tax Free Withdrawals:

• While contributions are not tax deductible, the earnings in the account grow on a tax deferred basis and distributions are tax free if used to pay qualified higher education expenses.
• Qualified higher education expenses include college level tuition, fees, books, equipment, and basic room and board.

DISCLOSURE: THE ABOVE INFORMATION PRESENTS GENERAL INFORMATION ONLY, IS THOUGHT TO BE ACCURATE AS OF DECEMBER 2007, AND IS SUBJECT TO CHANGE BASED UPON EVER CHANGING US TAX LAWS. TO MAKE CERTAIN THAT OPENING A PARTICULAR ACCOUNT WILL SUIT YOUR NEEDS, BE SURE TO CONSULT A QUALIFIED TAX RESOURCE.