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HomeRecruitment GuideGlossary Terms A-ZIndividual retirement account
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Individual retirement account

An individual retirement account is a method for establishing a retirement savings plan. Usually, an IRA allows you to defer taxes until after you retire. It is tool for setting aside funds with eligible tax-free distributions. Although withdrawals and capital gains from IRAs are taxed as income, the tax rate may be lower because income is likely less after retirement. The government establishes annual contribution limits that rise with inflation. However, contributors age 50 and older can make slightly higher contributions to catch up. The inherent tax savings of contributing to the account make IRAs significantly worthwhile individual tax management tools.

Related Terms

  • Retirement Account
  • IRA
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    The content on our website is only meant to provide general information and is not legal advice. We make our best efforts to make sure the information is accurate, but we cannot guarantee it. Do not rely on the content as legal advice. For assistance with legal problems or for a legal inquiry please contact you attorney.

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