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Frequently Asked
Roth IRA Questions

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Is it Individual Retirement Account or Arrangements?

Publication 590 by the IRS refers to IRAs as Individual Retirement Arrangements. Most financial institutions and professionals will refer to the accounts as Individual Retirement Accounts. They are the same thing.

Can I contribute to a Roth IRA?

Most people can contribute to a Roth IRA. As long as you have reportable earned income, your income is below the established by the IRS, and you do not exceed the annual contribution limits to your IRA accounts, you are eligible to contribute. See the contribution section for more info.

Are Roth IRA accounts protected from bankruptcy?

Yes, funds in a Roth IRA are protected from bankruptcy. The Bankruptcy Abuse Prevention and Consumer Protection Act of 2005 created federal protection for IRA accounts that had previously been protected through many state laws.

Can I recognize losses on investments in my Roth IRA?

You can recognize the loss only when all the amounts in all of your Roth IRA accounts have been distributed to you and the total distributions are less than your total amount of contributions across all your Roth IRA accounts. You claim the loss as a miscellaneous itemized deduction. [based on info from IRS publication 590] 

Page last modified 2/3/2012