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LSDefine

Simple English definitions for legal terms

Roth IRA

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A quick definition of Roth IRA:

A Roth IRA is a type of savings account where you can put money in each year. You can't deduct the money you put in from your taxes, but you also don't have to pay taxes on the money you take out when you retire. You have to be at least 59 1/2 years old to take the money out without paying a penalty. It's named after a senator who helped create it.

A more thorough explanation:

A Roth IRA is a type of individual retirement account where a person can save money for their retirement. The account allows a person to contribute a certain amount of their earned income each year. The contributions and any interest earned in the account are not taxed until the money is withdrawn after the account holder reaches 59 1/2 years old. If the money is withdrawn before then, a penalty of 10% is applied.

For example, if a person earns $50,000 a year and contributes $5,000 to their Roth IRA, they will only be taxed on $45,000 of their income that year. When they reach 59 1/2 years old and withdraw the money, they will not have to pay taxes on the contributions or any interest earned.

A Roth IRA is different from a traditional IRA because contributions to a traditional IRA are tax-deductible when they are made, but the money is taxed when it is withdrawn. With a Roth IRA, contributions are not tax-deductible, but the money is not taxed when it is withdrawn.

Overall, a Roth IRA is a good option for people who expect to be in a higher tax bracket when they retire, as they will not have to pay taxes on the money they withdraw from the account.

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@Law-Guy Im feeling kinda happy I applied YM to UCI hoping it helps (:
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Cornell
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@HopefullyinLawSchool What's YM?
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oh no
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you mom
WorthlessAttractiveZombie
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Ouch
HopefullyInLawSchool
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your*
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I fear I realized too late
babycat
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another victim claimed
concorde
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pwned
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Might have to send in addendums for that
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No wave, so sad.
WorthlessAttractiveZombie
14:28
What are the odds that berk releases later today?
babycat
14:28
@Dkk: And here I thought you were a prophet. Smh.
14:33
@WorthlessAttractiveZombie: 4
WorthlessAttractiveZombie
14:35
@EvolBunny: I will take the odds of 4, very promising
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I'm too drunk to taste this chicken
Dkk
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Lol, I suck I guess. @babycat
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suck what? (:
Dkk
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suck at predicting
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boooooo
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hi guys
1a2b3c4d26z
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how is everyone doing this fine friday
1a2b3c4d26z
14:46
Tonight im going to go for a run and lift some weights and then eat some dinner (probably a burrito) and then I'm going to watch a scary movie with my girlfriend (probably Longlegs). I'm so excited :)
1a2b3c4d26z
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What is everyone else doing tonight
1a2b3c4d26z
14:47
Besides YM of course
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Yoooo I’m a lifter too
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I'm all good, I'm tipsy in Zanzibar finishing an app and laughing my ass off to this:
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