An Individual Retirement Account is known as an IRA, but the original IRA acronym stands for Individual Retirement Arrangement. One of the first aspects of an IRA is the custodial fees, the administration charges for accounting and client contact. Then you have to consider the funding instrument and its costs: mutual funds, exchange trade funds and annuities. If you qualify for the tax deduction, you need to determine if the tax savings during your working years is worth the tax consequences later in retirement. Distributions from your IRA are taxed at ordinary income taxes in your effective tax bracket and are includable in the provisional income test to determine if your IRA triggers taxation on your benefits. (Keep in mind that there is no tax-free basis in an IRA, i.e. your original contributions.) IRAs and Health Savings Accounts are the most under utilized tax advantaged funding vehicle available for tax-deductible contributions up to $3,400 for individuals, $6,750 for married couples and an additional $1,000 for those over age 55. The IRS also allows a one-time maximum tax-free transfer of $6,750, (or $7,750 if you’re age 55 or older), once in your lifetime from an IRA to an HSA account. Keep   Read more…