When talking about IRA accounts, the conversation generally begins and ends with taxes. The first major benefit a Roth IRA has over other types of investments is the fact that it not only grows tax free, but can also be distributed tax free. While it is not uncommon for any type of IRA to grow without being taxed, the Roth IRA is the only type that allows you to take qualified distributions without being taxed.
Additionally, with a Roth IRA, there is no limit to how long you may contribute to your Roth IRA as long as you meet the income requirements established by the IRS. Also, you are not required to take distributions at a certain age either.
Roth IRAs may also be passed on to heirs without the entanglement of the probate process. Because a Roth IRA is a beneficiary account (you designate the beneficiary), should something happen to you, the investment passes directly to your beneficiary without any further legal process. Then, your heir can decide whether to roll that amount into an existing Roth IRA or cash the account out without tax penalty.
We encourage you to speak with your tax adviser before making any investment decision that may impact your taxes. To learn more about the Roth IRAs available to you at BancorpSouth, click here, call us at 1-888-797-7711, or stop by one of our branches.