Raleigh, NC-- (SBWIRE) -- 03/12/2011 -- W. Landon Watts (http://www.LandonWatts.com), wealth strategist for Raleigh-based Banyan Rock & Talent, notes that taxpayers can use the additional three days to file their 2010 tax returns this year to make an IRA contribution. Emancipation Day, a holiday observed in the District of Columbia falls on Saturday, April 16 and is observed on Friday, April 15. By law, D.C. holidays impact tax deadlines in the same manner that federal holidays do.

“Contributing to an IRA is one of the best ways to build your financial nest egg,” says Watts. “Starting early and remaining consistent can help ensure your retirement years are financially sound.”

The Internal Revenue Services offers guidance on IRAs for use in preparing 2010 tax returns. Individuals can download a helpful PDF at http://www.ors.gov/pub/irs-pdf/p590.pdf. To assist taxpayers, Watts explains differences between traditional and Roth IRAs and provides guidelines for making contributions for the 2010 tax year:

Traditional IRAs
o Savings accounts set up using “pre-tax” funds

o Individuals do not pay tax on their earned income being deposited

o Individuals are taxed at the time they withdraw money from the IRA

o The goal of a traditional IRA is to compound as much money as possible between the set-up date and the date when contributors begin taking distributions

o For traditional IRAs, individuals are required by law to begin taking “required minimum distributions” at age 70 ½ , and must stop making contributions into the account

Roth IRAs
o Savings accounts using “after-tax” funds

o Tax is paid on the earned income prior to deposit into the account

o Individuals do not pay tax on the qualified money when they being making withdrawals

o There is no age limit on contributions to a Roth IRA

Watts notes that contribution limits remain the same for the 2010 tax year. Individuals under age 50 may contribute up to $5,000 per year. Individuals older than 50 are afforded a “catch up contribution” and may contribute up to $6,000 per year. To be eligible to contribute to a traditional or Roth IRA, individuals must have “earned income.”

“Staying up to date on changing IRA requirements and deciding which plan may be best for you can sometimes be a daunting task,” Watts adds. “Taking time to research available information and to speak to investment professionals can reduce some of the anxiety.”

For more information on IRAs, call Watts at 919.782.0033 or visit www.LandonWatts.com.
This information is not intended to be a substitute for specific individualized tax or legal advice. Please note that individual situations can vary. Therefore, the information should only be relied upon when coordinated with individual professional advice.

About W. Landon Watts
W. Landon Watts specializes in wealth strategy solutions for individuals, corporations and institutions, focusing on retirement and insurance planning in both the non-profit and for-profit sectors. Watts joined Banyan Rock & Talent in 1997. He currently holds an Investment Company and Variable Contract license, as well as a Life and Health Insurance license. Though not a CPA, Watts and Banyan Rock & Talent wealth strategists work within specific legal parameters to indicate tax-advantage opportunities that clients along with their accountants can utilize. Watts understands everyone has different goals, risk tolerances and objectives; he enjoys customizing each portfolio for his clients. Watts received a Bachelor of Science degree from Appalachian State University in 1993.

He is licensed to conduct business in Florida, Indiana, North Carolina, South Carolina and Virginia. For further information, visit http://www.LandonWatts.com, 3356 Six Forks Road Raleigh, NC 27609, or call (919) 782-0033.

Securities offered through FSC Securities Corporation, Member FINRA/SIPC. Banyan, Rock & Talent is not affiliated with FSC Securities Corporation or registered as a broker/dealer or investment advisor.