Attention IRA Owners – Your Individual Retirement Account Just Got Better

An IRA is already an appealing retirement saving vehicle. Now, several provisions in recently enacted federal laws may make IRAs even more attractive.

Plan Beneficiaries.
Beneficiaries other than a surviving spouse may roll over amounts inherited from a qualified retirement plan to an IRA. Before the recent changes, only surviving spouses had that option. Spouses can defer payouts until they reach age 70½. Non-spouse beneficiaries must generally begin IRA distributions immediately.

Deposit a Refund.
Taxpayers can have all or part of their federal income-tax refunds deposited directly into an IRA (within applicable limits).

Inflation Hedge.
Income limits on deductible contributions to traditional IRAs and after-tax contributions to Roth IRAs will be indexed for inflation in the future.

Charitable Distributions.
Until December 31, 2009, traditional or Roth IRA owners who are at least 70½ may authorize distributions of up to $100,000 to a qualified charity (or charities) without having to include the donated amount in income. The distribution must be made directly by the IRA trustee or custodian to the charity and may not exceed $100,000 in a single year. This tax break had expired at the end of 2007, but recent legislation extended it until the end of 2009.

Distribution Rollovers.
Beginning in 2008, participants can make direct rollovers of distributions from qualified plans, 403(b) arrangements, and governmental 457 plans to Roth IRAs. Distributions will be taxed at the time of the rollover and the participant must meet applicable income limits. However, future withdrawals from a Roth IRA won’t be taxed, and no minimum distributions are required. Thus, a Roth IRA can be passed to heirs tax free if the account owner won’t need the money.

In addition, one of the new laws makes permanent the 2001 tax law provisions relating to retirement plans and IRAs that were due to sunset after 2010.

Pursuant to IRS Circular 230, MetLife is providing you with the following notification: The information contained in this document is not intended to (and cannot) be used by anyone to avoid IRS penalties. This document supports the promotion and marketing of insurance or other financial products and services. You should seek advice based on your particular circumstances from an independent tax advisor.

The foregoing discussion is general in nature and not intended as specific advice. No reference to any MetLife product is intended. Neither MetLife nor its representatives offer legal or tax advice. Please consult with your own legal or tax advisor concerning your specific situation.

For information on MetLife insurance or other financial products and services, please contact [full name], [company approved title] with [MetLife, MetLife Resources], [office address], at [FINRA registered office phone number (required)] or [other number (optional), MetLife e-mail address, MetLife FSR Website].