What you can do is make a non-deductible IRA contribution. I'm not usually a big fan of non-deductible IRA's. Why? Because although the IRA grows tax-deferred you pay taxes at ordinary rates on all the income you eventually withdraw from it - even income attributable to long-term capital gains and qualified dividends that usually are subject to the reduced 15% federal tax rate. There's a quirk in the law, however, coming up in 2010 (assuming congress doesn't change the law before then) that means in that year (and thereafter) you will be able to convert your non-deductible IRA to a Roth IRA (paying the taxes on the appreciation over that period) with no regard to income limitations. It's a back door way of getting into a Roth IRA. If you already have some deductible IRA accounts it doesn't work as well (for reasons too complex to go into here), but otherwise it's a no brainer. Rod - I'm a CPA, but not your CPA. Everybody's tax circumstances can differ - consult with a tax expert. Posts in this Thread:
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