Table of Contents

Course Learning Objectives. v

Introduction. v

Important Note About the DOL Fiduciary Rule. v

Chapter 1 – Traditional IRAs. 1

Chapter Learning Objectives. 1

Introduction. 1

Traditional IRA Eligibility Rules. 1

Earned Income. 2

Limits on Contributions. 2

Traditional IRA Tax Considerations. 3

Traditional IRA Contributions. 3

Tax Treatment of Contributions by Active Participants. 4

Tax Credits. 7

Traditional IRA Accumulations. 8

Traditional IRA Rollovers. 10

Eligible Rollover Distributions. 10

Distributions Ineligible for Rollover 12

Direct and Indirect Rollovers. 12

Indirect Rollovers Subject to Timing and Frequency Limitations. 13

EGTRRA Permits Rollover of After-Tax Contributions. 14

Traditional IRA Distributions. 14

Premature Distributions. 14

Premature Distributions Avoiding Tax Penalty. 14

Pro-Rata Distribution of Non-Deductible Contributions. 15

Required Distributions during Owner’s Lifetime. 15

Required Minimum Distribution Amount 16

Required Distributions at Owner’s Death. 17

Death Before an Owner’s Required Beginning Date. 17

Life Expectancy Rule. 17

Surviving Spouse’s Life Expectancy Rule. 18

Five-Year Rule. 18

Surviving Spouse’s Election. 18

Death On or After the Required Beginning Date. 18

Summary. 18

Chapter 1 Review Questions. 20

Chapter 2 – Roth IRAs. 22

Chapter Learning Objectives. 22

Introduction. 22

Definition & Eligibility. 22

Limits on Contributions. 23

Roth IRA Tax Considerations. 24

Qualified Distributions Tax-Free. 24

Non-Qualified Distributions Receive FIFO Tax Treatment 26

Non-Qualified Gain Distributions Before 59 ˝ Subject to Tax Penalty. 26

No Required Lifetime Distributions. 27

Roth IRA Conversions & Transfers. 27

Roth IRA Death Benefit Distributions. 28

Life Expectancy Rule. 28

Surviving Spouse’s Life Expectancy Rule. 28

Five-Year Rule. 28

Surviving Spouse’s Election. 28

Summary. 29

Chapter 2 Review Questions. 30

Answers to Chapter Review Quizzes. 31

Glossary. 38

Index. 41

CPE Exam Answer Sheet 43

Final Examination. 44

CPASelfstudy.com Course Evaluation. 49