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
2007 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 2007, the deadline is April 15, 2008.
2007 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.
If you are an active participant in an employer sponsored retirement plan, the following table provides you with lower and upper modified adjusted gross income (MAGI) limits for 2007:
| Your Traditional IRA contribution is: | If you are married, filing jointly and your MAGI is: | If you are single and your MAGI is: |
|---|---|---|
| Fully Deductible | Less than $83,000 | Less than $52,000 |
| More than $83,000 but less than $103,000 | More than $52,000 but less than $62,000 | |
| Not Deductible | More than $103,000 | More than $62,000 |
Catch-up contribution provisions for individuals attaining the age of 50 before December 31, 2007
- In addition to the maximum contribution limit, for 2007, eligible IRA holders can contribute up to $1,000 as a catch-up contribution.
An HSBC Securities Financial Advisor will be happy to tell you more about a Traditional IRA, and whether it's the right retirement investment for you. A world of financial knowledge is available right at your neighborhood HSBC branch. Call 1-800-662-3343 or visit your HSBC branch to arrange a meeting.
Distributions from IRAs made prior to age 591/2 may result in penalties.
Securities and annuities are provided by Registered Representatives and Insurance Agents of HSBC Securities (USA) Inc., member NYSE/FINRA/SIPC, registered Futures Commission Merchant, a wholly-owned subsidiary of HSBC Markets (USA) Inc. and an indirectly wholly-owned subsidiary of HSBC Holdings plc.
Insurance products are offered through Insurance Agents of HSBC Insurance Agency (USA) Inc., a wholly-owned subsidiary of HSBC Bank USA, N.A., an affiliate of HSBC National Bank USA, and an indirectly wholly-owned subsidiary of HSBC Holdings plc. Products and services may vary by state and are not available in all states.
Securities, Annuities and Insurance Products are:
|
NOT A BANK DEPOSIT OR OBLIGATION OF THE BANK OR ANY OF ITS AFFILIATES |
NOT FDIC-INSURED |
NOT INSURED BY ANY FEDERAL GOVERNMENT AGENCY |
NOT GUARANTEED BY THE BANK OR ANY OF ITS AFFILIATES |
MAY LOSE VALUE |
HSBC Securities (USA) Inc. or any other member of the HSBC Group may from time to time underwrite, perform or seek to perform investment banking services for issuers or make a market or otherwise buy or sell as principal securities or other instruments, or together with the issuers directors, officers and employees may have either a long or short position in securities, commodities, currencies or other instruments or futures or options contracts convertible into securities or other instruments.
All decisions regarding the tax implications of your investment(s) should be made in connection with your independent tax advisor.
