President Ronald Reagan signs the Economic Recovery Tax Act of 1981, Rancho del Cielo, 1981. (Photo credit: Wikipedia)
An individual retirement account is a term used for retirement plan which has tax relaxations or advantages for saving for retirement under the laws of the United States. It can either be individual or joint accounts, or even can be in the form trusts or even accounts set up exclusively for retirement savings with tax benefits.
An IRA allows you to set aside a certain amount of savings with tax-deferred earnings, until the withdrawals begin at the age of 59 years. Tax payers were allowed to save or contribute up to $ 1,500 per annum to the retirement savings account and thereby reduce their taxable income. You can visit to know more about IRA.
Retirement Saving Schemes such as IRA were introduced in to the United States through amendments in the taxpayer benefits laws during 1974-75. Many amendments and laws came in to existence after that helped the people in their retirement savings. Few of them were good, few bad. Certain schemes were advantageous only for certain community or society.
Only the Workers who were not covered by a good employment based retirement security plan were blessed with the enactment of the Employee Retirement Income Security Act (ERISA) in the year of 1974. But, later in 1981, the Economic Recovery Tax Act (ERAT), under the tax laws of US government came into existence under which, it was possible for all taxpayers under the age 70 to contribute to an IRA. IRA can help you in leading retirement age comfortably.