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taxmap/pubs/p590-000.htm#en_us_publink1000230269
Publication 590

Individual 
Retirement 
Arrangements 
(IRAs)

rule

What's New for 2010(p2)


taxmap/pubs/p590-000.htm#en_us_publink1000248095

Due date for contributions and withdrawals.(p2)

Contributions can be made to your IRA for a year at any time during the year or by the due date for filing your return for that year, not including extensions. Because Emancipation Day, Saturday, April 16, 2011, a legal holiday in the District of Columbia, will be observed on Friday, April 15, 2011, the due date for making contributions for 2010 is April 18, 2011. See When Can Contributions Be Made? in chapter 1.
There is a 6% excise tax on excess contributions not withdrawn by the due date (including extensions) for your return. You will not have to pay the 6% tax if any 2010 excess contributions are withdrawn by April 18, 2011 (including extensions). See Excess Contributions under What Acts Result in Penalties or Additional Taxes? in chapter 1.
taxmap/pubs/p590-000.htm#en_us_publink1000230282

Modified AGI limit for traditional IRA contributions increased.(p2)

For 2010, if you were covered by a retirement plan at work, your deduction for contributions to a traditional IRA is reduced (phased out) if your modified AGI is:
If you either lived with your spouse or file a joint return, and your spouse was covered by a retirement plan at work, but you were not, your deduction is phased out if your modified AGI is more than $167,000 but less than $177,000. If your modified AGI is $177,000 or more, you cannot take a deduction for contributions to a traditional IRA. See How Much Can You Deduct? in chapter 1.
taxmap/pubs/p590-000.htm#en_us_publink1000230284

Modified AGI limit for Roth IRA contributions increased.(p2)

For 2010, your Roth IRA contribution limit is reduced (phased out) in the following situations. See Can You Contribute to a Roth IRA? in chapter 2.
taxmap/pubs/p590-000.htm#en_us_publink1000230286

Conversions and rollovers to Roth IRAs.(p2)

The modified AGI and filing status requirements for converting and rolling over amounts to a Roth IRA are eliminated.
Also, for any 2010 conversion or rollover, any amounts that would be included as income will be included in income in equal amounts in 2011 and 2012. You can choose to include the entire amount in income in 2010.
taxmap/pubs/p590-000.htm#en_us_publink1000230287

Catch-up contributions in certain employer bankruptcies.(p2)

The provision for additional catch-up contributions in certain employer bankruptcies does not apply for 2010 or later years.
taxmap/pubs/p590-000.htm#en_us_publink1000256038

Qualified charitable distributions (QCDs) made in January 2011.(p2)

The provision for QCDs has been extended for 2010 and 2011. If you make a QCD in January 2011, you can elect to have it treated as made in 2010. See January 2011 QCDs in chapter 1 for more information.

What's New for 2011(p2)


taxmap/pubs/p590-000.htm#en_us_publink1000254865

Modified AGI limit for traditional IRA contributions increased.(p2)

For 2011, if you are covered by a retirement plan at work, your deduction for contributions to a traditional IRA is reduced (phased out) if your modified AGI is:
If you either live with your spouse or file a joint return, and your spouse is covered by a retirement plan at work, but you are not, your deduction is phased out if your modified AGI is more than $169,000 but less than $179,000. If your modified AGI is $179,000 or more, you cannot take a deduction for contributions to a traditional IRA.
taxmap/pubs/p590-000.htm#en_us_publink1000254866

Modified AGI limit for Roth IRA contributions increased.(p2)

For 2011, your Roth IRA contribution limit is reduced (phased out) in the following situations.

Reminders(p3)


taxmap/pubs/p590-000.htm#en_us_publink1000230290

Simplified employee pension (SEP).(p3)

SEP IRAs are not covered in this publication. They are covered in Publication 560, Retirement Plans for Small Business.
taxmap/pubs/p590-000.htm#en_us_publink1000230291

Deemed IRAs.(p3)

A qualified employer plan (retirement plan) can maintain a separate account or annuity under the plan (a deemed IRA) to receive voluntary employee contributions. If the separate account or annuity otherwise meets the requirements of an IRA, it will be subject only to IRA rules. An employee's account can be treated as a traditional IRA or a Roth IRA.
For this purpose, a "qualified employer plan" includes:
taxmap/pubs/p590-000.htm#en_us_publink1000230292

Contributions to both traditional and Roth IRAs.(p3)

For information on your combined contribution limit if you contribute to both traditional and Roth IRAs, see Roth IRAs and traditional IRAs under How Much Can Be Contributed? in chapter 2.
taxmap/pubs/p590-000.htm#en_us_publink1000230294

Statement of required minimum distribution (RMD).(p3)

If an RMD is required from your IRA, the trustee, custodian, or issuer that held the IRA at the end of the preceding year must either report the amount of the RMD to you, or offer to calculate it for you. The report or offer must include the date by which the amount must be distributed. The report is due January 31 of the year in which the minimum distribution is required. It can be provided with the year-end fair market value statement that you normally get each year. No report is required for section 403(b) contracts (generally tax-sheltered annuities) or for IRAs of owners who have died.
taxmap/pubs/p590-000.htm#en_us_publink1000230296

IRA interest.(p3)

Although interest earned from your IRA is generally not taxed in the year earned, it is not tax-exempt interest. Tax on your traditional IRA is generally deferred until you take a distribution. Do not report this interest on your return as tax-exempt interest. For more information on tax exempt interest, see the instructions for your tax return.
taxmap/pubs/p590-000.htm#en_us_publink1000230297

Disaster-related tax relief.(p3)

Special rules apply to the use of retirement funds (including IRAs) by qualified individuals who suffered an economic loss as a result of: For more information on these special rules, see Tax Relief for Kansas Disaster Area and Tax Relief for Midwestern Disaster Areas in chapter 4.
taxmap/pubs/p590-000.htm#en_us_publink1000230301

Photographs of missing children.(p3)

The Internal Revenue Service is a proud partner with the National Center for Missing and Exploited Children. Photographs of missing children selected by the Center may appear in this publication on pages that would otherwise be blank. You can help bring these children home by looking at the photographs and calling 1-800-THE-LOST (1-800-843-5678) if you recognize a child.

taxmap/pubs/p590-000.htm#TXMP17c242edIntroduction

This publication discusses individual retirement arrangements (IRAs). An IRA is a personal savings plan that gives you tax advantages for setting aside money for retirement.
taxmap/pubs/p590-000.htm#en_us_publink1000230302

What are some tax advantages of an IRA?(p3)

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Two tax advantages of an IRA are that:
taxmap/pubs/p590-000.htm#en_us_publink1000230303

What's in this publication?(p3)

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This publication discusses traditional, Roth, and SIMPLE IRAs. It explains the rules for:
It also explains the penalties and additional taxes that apply when the rules are not followed. To assist you in complying with the tax rules for IRAs, this publication contains worksheets, sample forms, and tables, which can be found throughout the publication and in the appendices at the back of the publication.
taxmap/pubs/p590-000.htm#en_us_publink1000230304

How to use this publication.(p3)

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The rules that you must follow depend on which type of IRA you have. Use Table I-1 to help you determine which parts of this publication to read. Also use Table I-1 if you were referred to this publication from instructions to a form.
taxmap/pubs/p590-000.htm#en_us_publink1000253494

Comments and suggestions.(p3)

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We welcome your comments about this publication and your suggestions for future editions.
You can write to us at the following address:

Internal Revenue Service 
Individual Forms and Publications Branch 
SE:W:CAR:MP:T:I 
1111 Constitution Ave. NW, IR-6526 
Washington, DC 20224


We respond to many letters by telephone. Therefore, it would be helpful if you would include your daytime phone number, including the area code, in your correspondence.
You can email us at *taxforms@irs.gov. (The asterisk must be included in the address.) Please put "Publications Comment" on the subject line. You can also send us comments from www.irs.gov/formspubs, select "Comment on Tax Forms and Publications" under "Information about."
Although we cannot respond individually to each comment received, we do appreciate your feedback and will consider your comments as we revise our tax products.
taxmap/pubs/p590-000.htm#en_us_publink1000253495
Ordering forms and publications.(p4)
Visit www.irs.gov/formspubs to download forms and publications, call 1-800-829-3676, or write to the address below and receive a response within 10 days after your request is received.

Internal Revenue Service 
1201 N. Mitsubishi Motorway 
Bloomington, IL 61705-6613


taxmap/pubs/p590-000.htm#en_us_publink1000253496
Tax questions.(p4)
If you have a tax question, check the information available on IRS.gov or call 1-800-829-1040. We cannot answer tax questions sent to either of the above addresses.

taxmap/pubs/p590-000.htm#TXMP4c3ca077

Useful items

You may want to see:


Publications
 560 Retirement Plans for Small Business (SEP, SIMPLE, and Qualified Plans)
 571 Tax-Sheltered Annuity Plans (403(b) Plans)
 575 Pension and Annuity Income
 939 General Rule for Pensions and Annuities
 4492-A Information for Taxpayers Affected by the May 4, 2007, Kansas Storms and Tornadoes
 4492-B Information for Affected Taxpayers in the Midwestern Disaster Areas
Forms (and instructions)
 W-4P: Withholding Certificate for Pension or Annuity Payments
 1099-R: Distributions From Pensions, Annuities, Retirement or Profit-Sharing Plans, IRAs, Insurance Contracts, etc.
 5304-SIMPLE: Savings Incentive Match Plan for Employees of Small Employers (SIMPLE)–Not for Use With a Designated Financial Institution
 5305-S: SIMPLE Individual Retirement Trust Account
 5305-SA: SIMPLE Individual Retirement Custodial Account
 5305-SIMPLE: Savings Incentive Match Plan for Employees of Small Employers (SIMPLE)–for Use With a Designated Financial Institution
 5329: Additional Taxes on Qualified Plans (Including IRAs) and Other Tax-Favored Accounts
 5498: IRA Contribution Information
 8606: Nondeductible IRAs
 8815: Exclusion of Interest From Series EE and I U.S. Savings Bonds Issued After 1989
 8839: Qualified Adoption Expenses
 8880: Credit for Qualified Retirement Savings Contributions
 8930: Qualified Disaster Recovery Assistance Retirement Plan Distributions and Repayments
See chapter 6 for information about getting these publications and forms.

Table I-1. Using This Publication

IF you need
information on ...
THEN see ...
traditional IRAschapter 1.
Roth IRAschapter 2, and  parts of
chapter 1.
SIMPLE IRAschapter 3.
disaster-related relief (Midwestern, and Kansas)chapter 4.
the credit for qualified retirement savings contributions (the saver's credit)chapter 5.
how to keep a record of your contributions to, and distributions from, your traditional IRA(s)appendix A.
SEP IRAs and 401(k) plans Publication 560.
Coverdell education savings accounts (formerly called education IRAs) Publication 970.
  
IF for 2010, you
  • received social security benefits,
  • had taxable compensation,
  • contributed to a traditional IRA, and
  • you or your spouse was covered by an employer retirement plan,
and you want to...
THEN see ...
first figure your modified adjusted gross income (AGI)appendix B  worksheet 1.
then figure how much of your traditional IRA contribution you can deductappendix B  worksheet 2.
and finally figure how much of your social security is taxableappendix B.  worksheet 3.
taxmap/pubs/p590-000.htm#en_us_publink1000230320

Table I-2. How Are a Traditional IRA and a Roth IRA Different?

This table shows the differences between traditional and Roth IRAs. Answers in the middle column apply to traditional IRAs. Answers in the right column apply to Roth IRAs.

QuestionAnswer
 Traditional IRA? Roth IRA?
Is there an age limit on when I can open and contribute to aYes. You must not have reached age 701/2 by the end of the year. See Who Can Open a Traditional IRA? in chapter 1. No. You can be any age. See Can You Contribute to a Roth IRA? in chapter 2.
If I earned more than $5,000 in 2010 ($6,000 if I was 50 or older by the end of 2010), is there a limit on how much I can contribute to a Yes. For 2010, you can contribute to a traditional IRA up to:
  • $5,000, or
  • $6,000 if you were age 50 or older by the end of 2010.

There is no upper limit on how much you can earn and still contribute. See How Much Can Be Contributed? in chapter 1.
Yes. For 2010, you may be able to contribute to a Roth IRA up to:
  • $5,000, or
  • $6,000 if you were age 50 or older by the end of 2010,

but the amount you can contribute may be less than that depending on your income, filing status, and if you contribute to another IRA. See How Much Can Be Contributed? and Table 2-1 in chapter 2.
Can I deduct contributions to aYes. You may be able to deduct your contributions to a traditional IRA depending on your income, filing status, whether you are covered by a retirement plan at work, and whether you receive social security benefits. See How Much Can You Deduct? in chapter 1. No. You can never deduct contributions to a Roth IRA. See What Is a Roth IRA? in chapter 2.
Do I have to file a form just because I contribute to aNot unless you make nondeductible contributions to your traditional IRA. In that case, you must file Form 8606. See Nondeductible Contributions in chapter 1. No. You do not have to file a form if you contribute to a Roth IRA. See Contributions not reported in chapter 2.
Do I have to start taking distributions when I reach a certain age from aYes. You must begin receiving required minimum distributions by April 1 of the year following the year you reach age 701/2. See When Must You Withdraw Assets? (Required Minimum Distributions) in chapter 1. No. If you are the original owner of a Roth IRA, you do not have to take distributions regardless of your age. See Are Distributions Taxable? in chapter 2. However, if you are the beneficiary of a Roth IRA, you may have to take distributions. See Distributions After Owner's Death in chapter 2.
How are distributions taxed from aDistributions from a traditional IRA are taxed as ordinary income, but if you made nondeductible contributions, not all of the distribution is taxable. See Are Distributions Taxable? in chapter 1. Distributions from a Roth IRA are not taxed as long as you meet certain criteria. See Are Distributions Taxable? in chapter 2.
Do I have to file a form just because I receive distributions from aNot unless you have ever made a nondeductible contribution to a traditional IRA. If you have, file Form 8606.Yes. File Form 8606 if you received distributions from a Roth IRA (other than a rollover, qualified charitable distribution, one-time distribution to fund an HSA, recharacterization, certain qualified distributions, or a return of certain contributions).