Translate your decorating trends into your holiday decor. 

Well, it’s that time of year again!  If you’ve been out and about in the retail stores, you know that the holidays are creeping around the corner.  Already among the Halloween tricks and treats are your decorations for fall harvest:  pumpkins, gourds and botanicals in your favorite autumn colors.  Sitting discreetly on the shelves, waiting for the perfect moment to make their entrance, are boxes upon boxes of holiday lights and ornaments.  And you know, that as soon as the ghoulish displays are cleared, the Christmas trees seem to pop up out of nowhere.

As with the start of every New Year, some key financial planning opportunities will be available to all investors beginning in 2010.  One opportunity that has not received nearly as much press as others is the upcoming changes in the Roth IRA rules. 

Roth IRA Background

Roth IRAs were created with the Tax Payer Relief Act of 1997.  The attractiveness of a Roth IRA is very apparent.  Not only do funds placed in a Roth IRA, whether through annual contributions or conversions from traditional IRAs, appreciate tax-free, all distributions from a Roth IRA are tax-free as well.  Additionally, unlike traditional IRAs where you are required to withdraw a certain amount each year starting at age 70 ½, there are no required minimum distributions (RMDs) with Roth IRAs.

For the most part, though, the benefits mentioned above were only available to those families who’s modified adjusted gross income (AGI) was less than $100,000 each tax year.  This restriction kept the Roth benefits out of reach for higher income earners – the ones who would gain the most from the benefits. 

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