Form Mf 10023 16 PDF Details

Are you familiar with form Mf 10023 16? This form is used to request a certificate of non-importation. The purpose of this form is to certify that the imported goods have not been released for consumption in the United States and are subject to duty and restrictions. In order to complete this form, you will need to provide certain information about the imported goods, such as the Harmonized Tariff Schedule (HTS) number, description of the goods, and quantity of the goods. You may also include a statement from an authorized customs official if necessary. If you are unsure whether or not your imported goods need a certificate of non-importation, contact your regional Import Specialist for assistance.

This knowledge can help you grasp better the details of the form mf 10023 16 before starting filling it out.

Form NameForm Mf 10023 16
Form Length35 pages
Fillable fields0
Avg. time to fill out8 min 45 sec
Other namesMinnesota, AGI, distributions, homebuyer

Form Preview Example

Amount: $




The Hartford Mutual Funds IRA/Roth IRA Adoption Agreement






























To be used for IRA, Rollover IRA, and Roth IRA. Please see our separate application for SIMPLE and SEP IRAs.

















Fund Selection Preassigned account #:


















*Please Note: If no share class is

































indicated, Class A will be established.








































The Hartford Mutual Funds


























■ I am enclosing a separate check for the













$15 annual IRA maintenance fee.


























Mail completed forms to:













The Hartford Mutual Funds








P.O. Box 9140


























Minneapolis, MN 55480-9140













For additional information, ask your investment








representative or call toll-free at 1-888-843-7824,


























Monday – Thursday, 7:00 a.m. to 6:00 p.m. Central














Time, Fridays, 7:00 a.m. to 5:00 p.m. Central Time,




















or visit our website,



























Fax: 1-651-738-5534 (Signature Guarantee

















2. Individual Retirement Account Registration


Medallion Stamp cannot be faxed)




Please print clearly in CAPITAL LETTERS.





















First Name

Middle Initial

Last Name





Owner’s Date of Birth



Owner’s Social Security Number (used in tax reporting)



Residential Address (required) (including apartment or box number)














Home Phone


Work Phone



Individual Retirement Account Type









Please indicate the type of account you are establishing. If you are opening more than one type of account, complete a separate


application for each. The maximum IRA/Roth IRA contribution is $3,000 for the tax year 2002.





1. Traditional IRA Contribution. The enclosed contribution(s) is for: Tax Year:


Amount: $




2. Indirect Rollover.




3. IRA Transfer. Please complete the Retirement Asset Transfer Form. 2 Transferring Company’s Name:

4. Direct Rollover. Check here if you wish to roll over a distribution from an employer’s qualified retirement plan or a 403(b) plan.

Company Name:


Current Plan Type:

5. Roth IRA Contribution. The enclosed contribution(s) is for: Tax Year:

6.Roth IRA Rollover.

7.Roth IRA Transfer. Please complete the Retirement Asset Transform Form. 2

8.Roth IRA CONVERSION from a Traditional IRA. Please complete the Retirement Asset Transfer Form. 2

9.Transfers/Direct Rollovers: Please have your current custodian or Plan Administrator make the check payable to: The Hartford Mutual Funds, PO Box 9140, Minneapolis, MN 55480-9140

For the benefit of (your name) – Direct Rollover IRA or IRA Transfer and attach it to this completed application.

4. Telephone Exchanges

If no selection is made in this section, telephone exchanges will be approved. Shares of each class can only be exchanged for shares of the same class, and exchanges can only be processed among IRAs that have identical registrations.

I Do Not elect the telephone exchange privilege.


Page 1 of 35

5. Broker Dealer Your investment representative can supply this information

Registered Representative’s First Name

Middle Initial

Last Name:




Broker Dealer Name






Branch Street Address












Phone Number

Dealer Number

Branch Number




Rep Number



Reduced Sales Charges (optional)



6. RIGHTS OF ACCUMULATION To qualify for sales discounts on Class A shares, list below the account or contract numbers of all classes of shares of other Hartford Mutual Funds and The Director variable annuity or Variable Life insurance, Saver Plus and CRC con-

tracts that you or your family (spouse, children, in-laws, parents, grandparents, step-family members) already own.

Fund Name

Fund Name





Account Number

Account Number










The variable annuity contract or variable life insurance policy #__________________________

Approximate Value $ ___________

LETTER OF INTENTION I intend to buy more Class A shares and understand that I can reduce my sales charges through accumulated investments. I plan to invest over a 13 month period following the date of this application (or a date within the

past 90 days) an aggregate amount of at least:







QUALIFY FOR NET ASSET VALUE (NAV): This account qualifies for NAV purchase as described in the fund prospectus as stated below.






Other Explain




Proceeds from another load fund within 60 days. (initial purchase only)





Beneficiary Instructions (use an additional page if necessary.) I hereby designate the person(s) named below as Primary Beneficiary(ies) in accordance with the

IRA custodial agreement: This Designation of Beneficiary may have important tax or estate planning effects. Also, if you are married and reside in a community prop-

erty or marital property state (Arizona, California, Idaho, Louisiana, Nevada, Texas, Washington or Wisconsin), you may need to obtain your spouse’s consent if you have not


designated your spouse as Primary Beneficiary for at least half of your Roth or traditional IRA. See your lawyer or other tax professional for additional information and advice.







Social Security

Date of Birth/

Spouse: Yes/No




First Name, Middle Initial, Last Name




Date of Trust

or Trust


Name of



































































Please be sure that Percentages add up to a total of 100%

Name of Contingent Beneficiaries (optional)

8. IRA Agreement

I (i) am of legal age and legal capacity; (ii) have received and read a current prospectus of any fund and description of any choice selected; (iii) agree that an annual maintenance fee of $15 will be deducted from my IRA unless I have paid the fee separately;(iv) certify under the penalties of perjury that the taxpayer identification number (Social Security Number) set forth in Section 2 is true, correct, and complete;(v) appoint U.S. Bank National Association as custodian. The depositor and the custodian hereby adopt an agreement establish- ing an individual retirement account IRA. Its terms are described in the appropriate IRA custodial agreement. The depositor acknowledges having received and read the agreement. The agreement shall govern the depositor’s IRA established pursuant to this adoption agreement and investing in the above-named fund and in any other fund the depositor may subsequently select for this IRA.

I assume complete responsibility for determining whether I am eligible to contribute to a Roth or Traditional IRA, and that my contributions, including rollovers and conversions, meet the limits and guidelines set forth under tax law. I understand the tax consequences associated with both contributions to, and distributions from my Hartford Mutual Funds Roth or Traditional IRA.

Owner’s Signature


Date ______________________________________

Please make all checks payable to The Hartford Mutual Funds.


Page 2 of 35

The Hartford Mutual Funds (Fund Numbers)

The Hartford Mutual Funds

Class A


Fund #

Advisers Fund


Capital Appreciation Fund


Disciplined Equity Fund


Dividend and Growth Fund


Equity Income Fund


Focus Fund


Global Communications Fund


Global Financial Services Fund


Global Health Fund


Global Leaders Fund


Global Technology Fund


Growth Fund


Growth Opportunities Fund


High Yield Fund


Income Fund


Inflation Plus Fund


International Capital Appreciation Fund


International Opportunities Fund


International Small Company Fund


MidCap Fund*


MidCap Value Fund


Money Market Fund


Short Duration Fund


Small Company Fund


SmallCap Growth Fund


Stock Fund


Tax-Free California Fund


Tax-Free Minnesota Fund


Tax-Free National Fund


Tax-Free New York Fund


Total Return Bond Fund


U.S. Government Securities Fund


Value Fund


Value Opportunities Fund


Class B Fund #



































Class C Fund #



































*The Hartford MidCap Fund is closed to new investors as of end of day July 31, 2003.


Page 3 of 35

Traditional/Roth IRA Disclosure Statement

This disclosure statement explains our Traditional/Roth IRA and the basic federal tax rules for Traditional and Roth IRAs.

It does not cover state or local tax rules.

Disclaimer. Please note the following limitations to this disclosure:

This disclosure statement is based on federal laws and regulations on September 1, 2002, which are effective for tax years beginning on or after January 1, 2002.

Additional information has been obtained from sources believed to be accurate and current as of September 1, 2002, but we do not guarantee its accuracy.

Changes to the federal tax laws may have been made after the date this disclosure statement was prepared.

This disclosure statement is provided for general informational purposes. You should consult with your attorney, accountant or other tax adviser before making any investments in, making withdrawals from, or taking any other actions with respect to your IRA.

This disclosure statement does not discuss the state and local tax treatment of IRA contributions and distributions which may differ substantially from the federal tax rules. You should consult with your attorney, accountant or other tax advisor regarding any state or local tax rules that may apply to your IRA.

Our employees and agents cannot give you tax or legal advice with respect to your IRA.


You may revoke this IRA for any reason during the seven-day period after you sign the IRA Application. To revoke this IRA, you must give written notice to the Custodian by mailing or personally delivering the written notice of revocation to the attention of the IRA Department at the Custodian whose name, address and telephone number appear on your IRA Application. The written notice of revo- cation must be received by the Custodian, or postmarked, by the close of the seven-day revocation period.

If you revoke your IRA as described above, we will return everything you paid us.


We offer you the following Traditional and Roth IRA choices:

Traditional IRA. You may establish a Traditional IRA to hold tax- deductible and non-deductible contributions for you or your spouse. (See item 4.) Also, a Traditional IRA may hold cash or other assets rolled over or transferred from a retirement plan or another Traditional IRA.

Roth IRA. You may establish a Roth IRA to hold non-deductible con- tributions for you or your spouse. (See item 5.) The Roth IRA may also be established to hold rollover or transfer contributions from another Roth IRA or conversions from a Traditional IRA.

Conduit IRA. A Conduit IRA is designed to maintain certain IRA assets separate from other assets to preserve rollover options in the case of rollovers and transfers from a retirement plan. (See item 9(c).) The Conduit IRA may also simplify recordkeeping when converting a Traditional IRA to a Roth IRA. It is your responsibility to maintain the IRA as a Conduit IRA, if you so desire. To maintain its conduit status, you must ensure that it receives no contributions other than rollover contributions from employer retirement plans (or the converted assets).

BEN-IRA. If you inherit an IRA and you wish to continue holding it, your inherited IRA must be maintained as a BEN-IRA. No additional contributions may be made to the BEN-IRA. (See item 6.) However, a surviving spouse beneficiary may elect to treat the inherited IRA as his/her own and a BEN-IRA will not be established. (See item 17.)

SEP-IRA. A SEP-IRA is designed to hold any tax-deductible employ- er contributions to a simplified employee pension (“SEP”) plan and employee pre-tax contributions, if the SEP permits them. It may also hold the Traditional IRA contributions of a participant in the SEP plan. (See item 7.)

This Traditional/Roth IRA cannot be used for the following:

Coverdell Education Savings Accounts. Formerly called Education IRAs, these accounts are used to hold tax-deductible contributions for a child’s education expenses.

SIMPLE IRAs: These IRAs are used to hold employer tax-deductible contributions and employee pre-tax contributions to a Savings Incentive Match Plan for Employees (“SIMPLE”) plan.

However, we offer Coverdell Education Savings Accounts and SIM- PLE IRAs through other vehicles. Please contact us for more infor- mation.


You may maintain and contribute to more than one kind of IRA. Also, you may have more than one IRA of the same type.

3(a) Maximum Contributions.

There is a combined tax law limit on how much you can contribute to all of your Traditional and Roth IRAs in a given year. The annual limit that applies to you depends on your age at the end of the calendar year


Page 4 of 35

Traditional/Roth IRA Disclosure Statement continued

in question and the Internal Revenue Code maximum for that tax year. For the limit in effect for any given tax year, refer to the chart below.

Limit for Taxpayers under Age 50. For 2002, your total Traditional and Roth IRA contributions cannot exceed the lesser of $3,000 or 100% of your compensation, or if you are married and file a joint tax return, the combined compensation of you and your spouse. You may also contribute to your spouse’s IRAs if you file a joint tax return, so long as the contributions made for each spouse do not exceed $3,000 (if both spouses are under age 50) and the combined IRA contributions for you and your spouse do not exceed 100% of your combined compen- sation.

Limit for Taxpayers Age 50 or Over. Starting in 2002, if you are 50 or over by the end of the applicable calendar year you may make addi- tional "catch-up" contributions to your IRAs for that year. If you qual- ify, you may contribute a total of $3,500 to your IRAs for 2002 (sub- ject to the compensation requirements above). You may make this additional contribution regardless of your past contribution history.

Contribution Limits.

For tax years

Contribution limit for

Contribution limit for

beginning in

taxpayers under age 50

taxpayers age 50 or over



















2008 and after



The annual contribution limits will be adjusted for inflation for years after 2008.

The appropriate dollar figure for the applicable tax year will replace all references to the $3,000 annual limit (or $3,500 for those age 50 or over) used in this disclosure statement.

3(b) Minimum Contribution.

You may contribute less than the maximum amount for a year, if you wish. Under our Self-Directed IRA, annual contributions are not required and there is no minimum investment, unless otherwise pro- vided in the Application for this IRA. However, if you skip a year or contribute less, federal tax rules do not allow you to contribute more in a later year to make up for the missed contribution.

3(c) Compensation and Alimony/Maintenance.

Compensation. Generally, if you work, the amount that you earn is compensation. Compensation includes wages, salaries, professional fees and other amounts (such as bonuses, commissions and tips) you receive for providing personal services. Compensation is based on your own earnings, without regard to state community property laws.

However, compensation does not include the following: (i) deferred compensation, (ii) pensions, annuities and other retirement income,

(iii)earnings and profits from property (including dividends, interest and rents) and (iv) amounts excluded from income (such as foreign earned income).

You may determine your compensation based on your W-2 by sub- tracting the amount in box 11 (Non-qualified Plans) from box 1 (Wages, etc.). (This assumes that the amounts shown on your W-2 are correct.)

Self-Employment Income. Compensation includes net earnings from self-employment as a sole proprietor or partner – your earned income (as defined in Sec. 401(c)(2) of the Internal Revenue Code). To qualify as earned income, your personal services must be a material income-producing factor in the business or profession. In determining compensation, your net earnings must be reduced by the deduction you take for the contributions you made to a self-employed retirement plan.

Alimony/Maintenance. All taxable alimony or maintenance payments received by a divorced spouse under a decree of divorce or separate maintenance is treated as compensation for IRA purposes.

Marital Status. If a taxpayer and the taxpayer’s spouse did not live together at any time during a year and did not file a joint return for that year, these married taxpayers will be treated as unmarried for pur- poses of determining the IRA contribution limits for that year.

4.TRADITIONAL IRAS 4(a) Eligibility.

General Rules. You may contribute to your Traditional IRA for any year that you (or your spouse) have compensation. You may have an IRA even if you participate in another retirement plan.

Age Limit. Under federal tax rules, you cannot contribute to your Traditional IRA for the year in which you reach age 701/2 or any later year. However, you may continue to make contributions to your spouse’s Traditional IRA until your spouse reaches age 701/2.

4(b) Types of Contributions.

There are two types of Traditional IRA contributions: those that are deductible on your income tax return (tax-deductible contributions) and those that are not (non-deductible contributions). Your Traditional IRA con- tributions may be all tax-deductible contributions, all non-deductible, or a mixture of both. However, your total Traditional IRA contribution may not exceed the applicable maximum contribution limit that applies to you in the given tax year. (See item 3.)

4(c) Tax-Deductible Contributions.

The federal income tax deduction for contributions to a Traditional IRA for you and/or your spouse may be less than the IRA maximum contribution limit. The deduction depends on:

(1)Whether you (or your spouse) are an active participant in a retire- ment plan, and

(2)The amount of your adjusted gross income (“AGI”), or if you file a joint return, the combined AGI of you and your spouse.

Active Participant. You are an “active participant” for a year if, at any point in that year, your employer or union has a retirement plan under which money is added to your account or you are eligible to earn retirement credits. For example, you are likely to be an active partici- pant if you are covered under:

A profit sharing plan, a pension plan, a stock bonus plan, an ESOP or an annuity plan;

A salary reduction arrangement (for instance, under a 401(k) plan, SIMPLE IRA, or tax-sheltered annuity) to which you contribute;


A SIMPLE IRA with non-elective employer contributions;


Page 5 of 35

Traditional/Roth IRA Disclosure Statement continued

IRA Highlights (with 2002 values)*












You are eligible if you (or your spouse) has taxable compensation for the year.

There is no upper limit on your income.

You must be under 701/2 to con- tribute.

You are eligible to contribute if you (or your spouse) has taxable compen- sation for the year and your modified adjusted gross income is less than $110,000 (single), $160,000 (married filing jointly), or $10,000 (married fil- ing separately).

There is no upper limit on age.

You are eligible to participate in a SEP-IRA if your employer has estab- lished a SEP plan and you meet the plan’s eligibility requirements.

If you are self-employed, you may establish a SEP plan.

There is no upper limit on age.

Maximum Contribution

$3,000 ($3,500 if age 50 or over) or, if less, 100% of your compensation (or your combined compensation, if you are married and filing jointly).

Your maximum deductible contribu- tions will be reduced if you partici- pate in another retirement plan and your adjusted gross income is $34,000 or more (single), $54,000 or more (married filing jointly), or $0 (married filing separately).

Your maximum tax-deductible contri- bution will be reduced if your spouse participates in a retirement plan and you have a combined adjusted gross income of $150,000 or more (married filing jointly) or $0 (married filing separately).

No income restrictions on non- deductible contributions.

No minimum annual contributions.

$3,000 ($3,500 if age 50 or older) or, if less, 100% of your compensation (or your combined compensation, if you are married and filing jointly).

Your maximum contribution to the Roth will be reduced if your income is between $95,000 and $110,000 (single), $150,000 and $160,000 (married filing jointly), or up to $10,000 (married filing separately).

No minimum annual contributions.

Your employer may contribute up to $40,000 or 25% of your compensa- tion, if less. For this purpose, your compensation will be capped at $200,000.

If your plan offers a salary deferral option, you may contribute up to $11,000 ($12,000 if age 50 or over).

Your participation in a SEP may reduce your tax-deductible IRA con- tributions.

Tax Benefits

Contributions are tax-deductible, subject to the income limits.

Earnings on the contributions are not taxed until withdrawn.

Possible tax credit for making contri- butions.

Contributions are non-deductible.

Earnings are never taxed if taken as qualified distributions.

Possible tax credit for making contri- butions.

Contributions are excluded from your income and are not taxed until with- drawn.

Earnings on the contributions are not taxed until withdrawn.

Possible tax credit for making salary deferral contributions.

Payment ofBenefits

You generally control how the bene- fits are paid and when.

You must begin receiving minimum distributions after age 701/2.

Distributions prior to 591/2 are subject to 10% penalty tax, unless an excep- tion applies.

You generally control how benefits are paid and when.

No required minimum distributions after age 701/2.

Contributions (other than conver- sions) may be withdrawn tax-free at any time.

Conversion contributions may be withdrawn without penalty after a 5- year holding period or after 591/2.

Distribution of earnings not taken as qualified distributions are subject to income tax and, if prior to 591/2, a 10% penalty tax, unless an exception applies.

You generally control how benefits are paid and when.

You must begin receiving minimum distributions after age 701/2.

Distributions prior to 591/2 are subject to 10% penalty tax, unless an excep- tion applies.

* This chart reflects 2002 contribution and threshold limits. Information regarding future years’ limits is located within this Disclosure Statement.


Page 6 of 35

Traditional/Roth IRA Disclosure Statement continued

A tax-sheltered annuity contract for employees of public schools and certain tax-exempt organizations, or

Certain governmental plans.

Your Form W-2 for the year should indicate your participation status. You are an active participant for a year even if you are not yet vested in your retirement benefit. Also, if you make required contributions or voluntary employee contributions to a retirement plan, you are an active participant. You may be an active participant even if you were only with the employer for part of the year.

The following situations alone do not make you an active participant: receiving benefits from a previous employer’s retirement benefit plan or being covered by social security or railroad retirement.

AGI Defined. “AGI” for purposes of determining your tax-deductible Traditional IRA contributions means your adjusted gross income for a year for federal income tax purposes, plus the amounts you deducted for student loan interest, foreign earned income and housing costs, employer paid adoption expenses, and certain qualified savings bond interest amounts. In addition, AGI for Traditional IRA purposes is also computed before deducting any Traditional IRA contributions you make for the year.

Full Deduction If Not Active Participants. If you (and your spouse) are not an active participant, your entire Traditional IRA contribution may be made as a tax-deductible contribution.

4(d) Phase-Out of Deductions for Active Participants.

If you are an active participant, the maximum amount of tax- deductible contributions that you may make to your Traditional IRA is phased-out over the following range of AGI for 2002:

Single Return/Head of Household:

$34,000 to $44,000

Joint Return/Qualified Widow(er):

$54,000 to $64,000

Married Filing Separate Return:

$0 to $10,000

Full Deduction Below Range. If your AGI is below the phase-out range, you (or your spouse) may make the maximum amount of tax- deductible contributions to your Traditional IRAs.

No Deduction Above Range. If your AGI is above the phase-out range and you are an active participant, you (or your spouse) may not make any tax-deductible contributions to your Traditional IRAs for the year. However, you may still make non-deductible contributions up to the maximum contribution limit for IRAs for that year. (See item 3.)

Future Increases in Phase-Out Range. The AGI ranges in which deductions are phased-out for single persons (or Head of Household filers) and for married persons filing a joint tax return (or Qualified Widow(er)s) are scheduled to increase in future years as follows:

Tax Year Beginning

Single Person


$34,000 - 44,000


$40,000 - 50,000


$45,000 - 55,000

2005 and thereafter

$50,000 - 60,000

Tax Year Beginning

Married Filing Jointly


$54,000 - 64,000


$60,000 - 70,000



- 75,000



- 80,000



- 85,000

2007 and thereafter


- 100,000

4(e) Phase-Out of Deduction for Spouses of Active Participants.

If your spouse is an active participant, but you are not, the maximum amount of tax-deductible contributions that may be made to your Traditional IRA is phased out over the following AGI range in 2002:

Joint Return:

$150,000 to $160,000

Married Filing Separate Return: $0 to $10,000

Full Deduction Below Range. If your AGI is below this range, you (or your spouse) may make the maximum amount of tax-deductible contri- butions to your Traditional IRAs.

No Deduction Above Range. If your AGI is above this range, you (or your spouse) may not make any tax-deductible contributions to your Traditional IRAs for the year. However, you may still make non- deductible contributions up to the maximum contribution limit for IRAs for that year. (See item 3.)

4(f) Figuring Your Deduction Limit if Your AGI is Within a Phase- out Range.

If your AGI is within a phase-out range, you must determine your deduction limit — the amount you may contribute to your Traditional IRA on a tax-deductible basis. The first step in determining the deduc- tion limit is to calculate your “excess AGI” for the year. You do this by subtracting the bottom number of the phase-out range applicable to you (the “Threshold Level”) from your AGI.

The second step is to apply the following formula:

$10,000 - Excess AGI x $3,000 = Deduction Limit $10,000

The third step is to adjust your result by rounding the result down to the next lower $10 level (the next lower number which ends in zero). For example, if the result is $1,525, you must round it down to $1,520. However, if the final result is between $0 and $200, your deduction limit is $200.

If both you and your spouse are active participants, the deduction limit applies separately to each spouse. You do not have to divide it between the spouses.

Your deduction limit cannot, in any event, exceed 100% of your com- pensation (or 100% of the combined compensation of you and your spouse).

Example 1 - Single, Active Participant: Ms. Smith, a single person under age 50, is an active participant and has an AGI of $38,619 in

2002. She calculates her tax-deductible IRA contribution as follows:

Her AGI is $38,619

Her Threshold Level is $34,000

Her Excess AGI is (AGI - Threshold Level) = $4,619


Page 7 of 35

Traditional/Roth IRA Disclosure Statement continued

So, her Traditional IRA deduction limit is:

$10,000 - $4,619 x $3,000 = $1,614 (rounded to $1,610) $10,000

Example 2 - Married Participants, Filing Joint Tax Return: Mr. and Mrs. Young file a joint tax return. Each spouse earns more than $3,000 and each is an active participant. They are both under age 50. They have a combined AGI of $56,255 in 2002. They may each contribute to an IRA and calculate their tax-deductible contributions to each IRA as follows:

Their AGI is $56,255

Their Threshold Level is $54,000

Their Excess AGI is (AGI - Threshold Level) = $2,255

So, each spouse would determine their Traditional IRA deduction limit as follows:

$10,000 - $2,255 x $3,000 = $2,324 (rounded to $2,320) $10,000

The deduction limit is $2,320 for Mr. Young’s Traditional IRA and $2,320 for Mrs. Young’s Traditional IRA. This gives the Youngs a max- imum deduction of $4,640 on their joint return.

Example 3 - Married Participant, Filing Separate Tax Return: Mr. Jones, a married person over 50 (and eligible to make “Catch-up” Contributions), is an active participant. He files a separate tax return. He has $1,500 of compensation in 2002 and wishes to make a tax- deductible contribution to a Traditional IRA.

His AGI is $1,500

His Threshold Level is $0

His Excess AGI is (AGI - Threshold Level) = $1,500 So, his Traditional IRA deduction limit is:

$10,000 - $1,500 x $3,500 = $2,975 (rounded to $2,970) $10,000

Even though his IRA deduction limit under the formula is $2,970, Mr. Jones may not deduct an amount in excess of his compensation, so his actual deduction is limited to $1,500.

Example 4 - Spouse of Active Participant, Filing Joint Tax Return:

Mr. and Mrs. Wilson file a joint tax return. Each spouse earns more than $3,000 and are under 50. Mr. Wilson is an active participant, but Mrs. Wilson is not. Mrs. Wilson calculates her tax-deductible contri- butions as follows:

Their AGI is $155,000.

Her threshold level is $150,000.

Her Excess AGI is (AGI - threshold level) is $5,000. Therefore her Traditional IRA deduction limit is:

$10,000 - $5,000 x $3,000 = $1,500


Mrs. Wilson’s deduction limit is $1,500. However, because the Wilsons’ AGI is above the phase-out range for married participants fil- ing joint tax returns, Mr. Wilson will not be able to make any tax- deductible contributions to his Traditional IRA for the year.

4(g) Non-Deductible Contributions.

If your tax-deductible contributions are limited due to the phase-out rules described above, you may make non-deductible contributions.

(See item 3.) In addition, you may also elect to treat a Traditional IRA contribution as non-deductible, even if you could have deducted part or all of the contribution. You designate a contribution as non- deductible at the time you file your tax return.

Investment earnings on your non-deductible Traditional IRA contri- butions (like the earnings on your deductible contributions) are not taxed until withdrawn from your Traditional IRA.

If you make a non-deductible contribution to an IRA (or designate a con- tribution as such), you must report the amount to the IRS on Form 8606 as a part of your tax return for the year. (You must file the Form 8606 even if you do not otherwise have to file a tax return for the year.)

Note: A penalty of $50 is imposed for each failure to properly file the Form 8606. In addition, a $100 penalty is imposed for any overstatement of the amount of des- ignated non-deductible contributions. A penalty will not be imposed if the tax- payer can show reasonable cause for failure to report the required information.

4(h) Corrective Withdrawals.

You may make a tax-free withdrawal of any contribution you make to your Traditional IRA for a year if you withdraw the contribution, together with any earnings on it, by the due date (including extensions) for filing your income tax return.

The withdrawal amount cannot be deducted on your tax return or reported as a non-deductible contribution. The contribution you withdraw is not included in your income as an IRA distribution, but you must include any earnings on the contribution as ordinary income for the year you made the contribution. The earnings also are subject to a 10% penalty tax on premature distribution if you are under age 591/2 (certain exceptions apply).

4(i) Tax Credit for Making IRA Contributions.

You may qualify for a new nonrefundable tax credit for contributing to your IRA. The credit is effective for the tax years beginning in 2002 through 2006. Generally, the credit for a tax year will be equal to your “applicable percentage” times the amount of “qualified retirement sav- ings contributions” as reduced by certain distributions received from retirement plans. The credit is in addition to any deduction from gross income that is otherwise allowed for the contribution.

Applicable Percentage. Your applicable percentage is determined by your filing status and your federal adjusted gross income. The maxi- mum credit rate is 50% and is subject to a phase-out, as detailed below:


Head of

All other








Not Over


Not Over

Over Not Over


$ 0


$ 0


$ 0



























For example, if you and your spouse file a joint return with a federal adjusted gross income of $36,000, your applicable percentage is 10%.

Qualified Retirement Savings Contributions. Qualified retirement savings contributions include IRA contributions, as well as contribu- tions to certain other plans. The total contribution amount is reduced by any distributions to you from:

(1) a qualified retirement plan or eligible deferred compensation plan


Page 8 of 35

Traditional/Roth IRA Disclosure Statement continued

(which is includible in your gross income during the “testing period” which includes the current tax year, the two preceding tax years, as well as the period after such tax year and before the due date for filing the tax return), or

(2)a Roth IRA within the testing period that are not qualified rollover contributions to a Roth IRA.

Note: A distribution received by your spouse is considered your distribution if you filed a joint tax return for the year of the distribution.

The total contribution amount taken into consideration for the tax credit is capped at $2,000.

Eligible Individuals. In addition to qualifying under the income phase-out, to be eligible for the credit, you must be at least 18 years old, must not be claimed as a dependent on someone else’s tax return and must not be a student (as defined in Sec. 151(c)(4) of the Internal Revenue Code).

Effect on Your Tax Liability. The credit may be used against both reg- ular and alternate minimum tax liability. The credit is applied after you apply any credit for child and dependent care and the child tax cred- it. In addition, the credit is nonrefundable and cannot reduce your total tax liability below zero.

Professional Advice. The requirements for this tax credit are very complex. We encourage you to consult with an accountant, lawyer or other qualified tax adviser about your situation.

4(j) Benefits Before Age 591/2.

Request for Payment. Upon written request, you may receive pay- ment of any or all of your Traditional IRA at any time before age 591/2. Payment may be requested for any reason, however, you must include a statement of the reason with the request.

10% Penalty Tax. In addition to regular income tax, you are subject to a penalty tax equal to 10% of the amount of taxable benefits paid before you reach age 591/2, unless an exception applies.

Exceptions. The penalty tax does not apply to benefits paid from a Traditional IRA:

After age 591/2.

After your death.

After your disability (as defined below).

In substantially equal periodic payments for your lifetime or the lifetimes of you and your beneficiary.

For first-time homebuyer expenses (up to $10,000) for you, your spouse, or any child, grandchild, parent, grandparent, or other ancestor of you or your spouse.

For higher education expenses for you, your spouse, your chil- dren and grandchildren, and your spouse’s children and grand- children.

For unreimbursed medical expenses exceeding 7.5% of adjusted gross income for the medical care of yourself, your spouse and your dependents.

For medical insurance premiums for you, your spouse and your dependents if all four of the following conditions apply:

(1)You lost your job;

(2)You received unemployment compensation paid under any federal or state law for 12 consecutive weeks;

(3)The distributions are made during either the year you received the unemployment compensation or the following year; and

(4)The distributions are made no later than 60 days after you have been reemployed.

Note: This includes a self-employed individual who would have received such unemployment compensation but for the fact he or she was self-employed.

On account of a tax levy on your IRA.

Disability. You are considered disabled for purposes of the exception if you cannot do any substantial gainful activity because of your phys- ical or mental condition. A physician must determine that the condi- tion is expected to be of long-continued and indefinite duration or to lead to death.

First-Time Homebuyer Expenses. The exception applies if you use the IRA distribution within 120 days after receipt to pay the costs of acquiring, constructing or reconstructing a principal residence for a “first-time homebuyer.” Such costs include any usual or reasonable set- tlement, financing or other closing costs. However, there is a lifetime limit of $10,000 on the aggregate distributions from all your IRAs for first-time homebuyer expenses.

A person who has not owned a principal residence for two years is considered a “first-time homebuyer.” For a married couple, both spous- es must satisfy this requirement. The 2-year measuring period ends on the date that a binding purchase contract is entered into for the prin- cipal residence or the construction or reconstruction of the principal residence begins.

If there is a delay or cancellation of the purchase or construction, the distribution may be rolled back into an IRA, tax-free, within 120 days of receipt.

Higher Education Expenses. The exception applies to the extent that your IRA distributions during the year do not exceed the qualified higher education expenses for academic periods in that year. Such expenses include tuition, fees, books, supplies and equipment required for enrollment or attendance at an eligible educational institution on a full-time, half-time or less than half-time basis. They also include room and board if the student is—enrolled at least half-time (generally, the school’s posted room and board charge, or $2,500 per year for students living off- campus and not at home).

The qualified expenses must be reduced by the amount of any Pell Grant or other tax-free scholarship, tax-free distributions from Coverdell Education Savings Accounts (formerly Education IRAs), and tax-free employer-provided educational assistance. However, they are not reduced for the individual’s earnings, education loans, gifts, inher- itances, personal savings, or savings from a qualified state tuition pro- gram.

An eligible educational institution is any college, university, vocation- al school or other post-secondary educational institution eligible to participate in federal student aid programs. This includes virtually all accredited public, nonprofit and proprietary post-secondary institu- tions.

Rollover or Transfer. There is no penalty tax on the payment if it is used to make a rollover contribution. (See item 9.) Also, there is no


Page 9 of 35

Traditional/Roth IRA Disclosure Statement continued

penalty tax if a direct transfer between custodians or trustees is made. (See item 10.)

4(k) Benefits Between Ages 591/2 and 701/2.

Request for Payments. Upon written request, you may receive pay- ment of any or all of your Traditional IRA at any time between ages 591/2 and 701/2. Payment may be requested for any reason and you do not need to mention the reason with the request.

4(l) Benefits After Age 701/2.

Deadline. Federal tax rules require that benefit payments from your Traditional IRAs begin no later than the April 1 following the calen- dar year in which you reach age 701/2—your required beginning date.

Request for Payment. You must select, in writing, one or a combina- tion of the following forms of payment for your Traditional IRA:

A single lump-sum payment; or

Periodic payments.

If you elected periodic payments, you may request additional pay- ments at any time.

Required Minimum Distributions. If you do not receive the entire balance of your Traditional IRA by the April 1 date, you must have started receiving payments each year that satisfy the federal required minimum distribution rules by that date. In April 2002, the IRS issued final regulations that simplify how required minimum distributions will be determined. The new rules must be used for required minimum distributions made for 2003 and beyond. In addition, the new rules may be used in 2002. This item 4(l) describes the new rules, which will result in lower required minimum distributions for most people. If you wish to determine your 2002 required minimum distribution under the old rules, consult your tax advisor for additional information.

Penalties for Failure to Take Minimum Distributions. After you reach age 701/2, you are subject to a penalty tax if the part of your Traditional IRA actually paid to you in a year is less than the minimum payment required by law. The penalty is 50% of the difference between the minimum required payment and the actual payment. If you have a pattern of failing to receive the required minimum distri- bution, the IRA could lose its tax-exempt status.

Periodic Payments. If you do not receive the entire balance of your Traditional IRA by your required beginning date, you must receive payment each year of at least your required minimum distribution.

Payments During Owner’s Lifetime. You have until April 1 of the year following the year you reach age 701/2 (your 701/2 year) to receive your distribution for your 701/2 year. The required minimum distribution for any year after your 701/2 year must be made by December 31 of that later year.

Example. You were born on February 20, 1932. You reach 701/2 on August 20, 2002. For 2002 (your 701/2 year), you must receive the required minimum distribution from your Traditional IRA no later than April 1, 2003. You must receive the required minimum distribu- tion for 2003 by December 31, 2003.

Figuring Your Required Minimum Distribution. Your required mini- mum distribution for each year is calculated by dividing the Traditional IRA account balance as of the close of business on December 31 of the preceding year by the applicable distribution period from the table.

The distribution period is based on your age and is not affected by your beneficiary’s age unless your sole beneficiary is your spouse who is more than 10 years younger than you, as discussed below.

To figure the required minimum distribution for 2003, divide your account balance at the end of 2002 by the distribution period from the table for your age as of your birthday in 2003.

Note: The table, found in the June 2002 Supplement to IRS Publication 590 (titled “Individual Retirement Arrangements (IRAs)”) is Table III (Uniform Lifetime). The correct distribution period is the "applicable divisor" listed next to your age as of the last day of the year for which you are calculating the required distribution.

However, there is a special rule for the second distribution year to take into account the fact that the first required minimum distribution need not be taken until April 1 of the year following your 701/2 year. The Traditional IRA account balance as of December 31 of the owner’s 701/2 year must be reduced by the portion (if any) of the required min- imum distribution made after the end of such year and prior to April 1 of the following year.

Example. Joe, born October 1, 1932, reached age 701/2 in 2003. He must receive his 2003 required minimum payment by April 1, 2004. Joe’s Traditional IRA account balance is $24,000 as of December 31, 2002—the last day of the year preceding the year for which payment is required, here 2003. Joe’s beneficiary does not qualify for the special treatment for younger spouses.

Joe’s distribution period for 2003 is 26.5, as Joe turns 71 in 2003. The required minimum distribution for 2003, Joe’s first distribution year (his 701/2 year), is $905.66 ($24,000 divided by 26.5). This amount is distribut- ed to Joe by April 1, 2004.

Joe’s Traditional IRA account balance as of December 31, 2003 is $26,400. To figure the minimum amount required to be distributed for 2004, this balance is reduced by the $905.66 minimum required dis- tribution for 2003 that was made by April 1, 2004. Thus, the account balance for determining the 2004 required distribution is $25,494.36.

Joe’s distribution period for 2004 is 25.6. The required minimum dis- tribution for 2004, his second distribution year, is $995.87 ($25,494.36 divided by 25.6). This amount is distributed to Joe by December 31, 2004.

Required Minimum Distribution When a Spouse is the Sole Beneficiary. If your spouse is more than 10 years younger than you, you may figure the required minimum distribution based on your joint life expectancy. To qualify, your spouse must be the sole beneficiary of your IRA account at all times during the year for which the distribu- tions are being made. (If your spouse was your sole beneficiary in a year until the time you are divorced or widowed, you may still determine your required minimum distribution for that year using your joint life expectancy. Consult your tax advisor for additional information.)

If you qualify, your required minimum distribution for each year is cal- culated in the same manner as above, except that the distribution peri- od is based on your joint life expectancy. The distribution period is the number at the intersection of the ages of you and your spouse (as of


Page 10 of 35

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