Readers’ Questions

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Can I contribute to both a regular IRA and a Roth IRA?

Yes, as long as you are allowed to by the tax law.  For 2015, the maximum contribution allowed to be contributed to an IRA was the lesser of $5,500 ($6,500 if over age 50) or your taxable compensation.  You can divide your contribution between a Roth and regular IRA any way you want as long as you don’t exceed these limits.


I received $20,000 from an inheritance.  How much tax will I owe?

If you received cash, you will most likely owe nothing.  If you inherit an IRA, you will owe taxes when you take the money out.  Be sure to check with your tax adviser. 

A related question is, “I gifted my child $10,000.  Will they have to pay tax and can I deduct it?”  No, they won’t have to pay taxes and no, you can’t deduct it.  If your gift to one person exceeds $14,000 in a year ($28,000 for a married couple) you are required to file a gift tax return.  See your tax adviser so they can help you with this.