An Individual Retirement Account seems like a simple instrument: we deduct contributions from our income, and the money grows in the account tax-deferred; we pay the taxes only when we withdraw it, in retirement, when we are in a lower tax bracket. IRAs, however, have their secrets, which not everyone knows. It is worth listing the most important ones.
You Can Shelter Money Earned on the Side in an IRA
If you work for yourself, you can shelter that income from taxes in a special SIMPLE IRA – a plan for small businesses that self-employed people can also use. In 2026 you can contribute up to $17,000 to it, plus $4,000 if you are over fifty (people aged 60–63 – plus $5,250). The condition is that you report the income on your tax return. Social Security taxes will increase your retirement benefit, and the tax deduction will eliminate income taxes.
Advice: Earning extra money after hours? Don’t hide it under the mattress. If you report the income, contribute, for example, $12,000 a year (a thousand dollars a month) to a SIMPLE IRA and invest regularly in ETFs that track the NASDAQ 100 or the S&P 500, you could become a millionaire after 25 years. All it takes is patience!
You Can Have More Than One IRA
For various reasons, you can have more than one IRA. Remember that an IRA is only a tax-advantaged “box” into which you can put any financial instruments you like. You can have one IRA at a bank with a convenient CD, and a second IRA at a brokerage firm to invest in mutual funds. When you leave a job, you can move the money from your workplace 401(k) into another IRA. If your adjusted gross income (AGI) rises to a level at which you can no longer contribute to an IRA, you can open a Roth IRA. If you inherited an IRA from your father, who did not have time to empty it, you will end up with yet another retirement account. That is allowed.
You can have any number of IRAs and contribute to them, but the total of your contributions in 2026 is limited to $7,500 a year, or $8,600 if you are over fifty. There is no point in multiplying accounts unnecessarily, because it means hassle as well as additional custodial fees.
Spouses Can Contribute Double, Even When Only One of Them Works
Not everyone knows that you are allowed to make a contribution on behalf of your spouse. And it is worth doing. IRAs have a relatively low annual contribution limit – in 2026 only $7,500, plus $1,100 for people over fifty. You will manage to save a significant amount in them only if you contribute regularly over many years and invest the money in stock funds. That is why maximizing contributions is key.
If you have a non-working spouse, he or she can also put money into his or her own IRA, provided you earn more than your combined contributions. This strategy is commonly called a spousal IRA. Together, the two of you can put up to $15,000 a year into your IRAs or Roth IRAs, or up to $17,200 if you are both over fifty.
You Can Contribute to an IRA Even If You Don’t Work
If you don’t work or earn little, but your spouse has earnings, you can fully participate in an IRA using the spousal IRA strategy mentioned above. This is an exception to the requirement that a participant must have earned income.
If your working spouse is not saving for the future, you can do it, even though you are a stay-at-home spouse.
You Can Have Someone Else Manage Your IRA
Brokerage accounts allow you to give a financial advisor authority to make investment decisions and carry out routine transactions without consulting you. A fixed fee is charged for managing the IRA. This arrangement is permitted for IRAs (but not for SDIRAs, see below), provided your broker has an appropriate written agreement with you. Handing investment management over to a professional may make sense for large accounts.
An IRA Protects Your Assets from Creditors
IRAs are protected in bankruptcy proceedings. The Bankruptcy Abuse Prevention and Consumer Protection Act of 2005 protects contributions in IRAs and Roth IRAs in bankruptcy up to a certain cap, which is adjusted for inflation every three years. Since April 1, 2025, this cap has been $1,711,975. SEP plans and SIMPLE IRAs, as well as employer 401(k) plans, profit-sharing plans and traditional company pensions, are also fully protected if you declare personal bankruptcy. This protection applies to all IRAs funded with your own contributions and to all assets rolled over into an IRA from a 401(k) or other plan.
State law determines how an IRA is protected against claims by other creditors who have obtained court judgments for payment.
IRA Beneficiary Designations Override Wills and Trusts
Have you distributed your estate in your will and think everyone will get what you left them? Think again. Your designation of an IRA beneficiary (Beneficiary Designation) supersedes a provision in a will or trust, because a will (trust) cannot change the terms of a contract. If, for example, in your will you left your bank IRA to your son, but at the bank you named your first wife as the beneficiary and never changed that designation, the IRA money will go to your ex-wife, not your son.
Review every account, not just your retirement accounts, and update your beneficiary designations.
You Can Hold Real Estate and Gold in an IRA
Yes, you can put real estate, precious metals and other assets into an IRA. That does not mean you should, but if it is done correctly, it is completely legal. This is made possible by a so-called self-directed IRA (SDIRA for short), which you can read more about in the book “Amerykańskie emerytury” (“American Pensions”).
The main difference between an SDIRA and other IRAs is the types of investments allowed. Regular IRAs and Roth IRAs are limited to typical securities, such as stocks, bonds, bank CDs and mutual funds or ETFs (Exchange Traded Funds).
SDIRAs (both traditional and Roth), on the other hand, allow the owner to invest in a much wider range of assets. Besides standard investments – stocks, bonds, cash, money market funds and investment funds – you can buy assets that are not usually part of a retirement portfolio: precious metals, commodities, private placements, limited partnerships, tax lien certificates, real estate, land, water rights, LLC interests, cryptocurrencies and other types of alternative investments. An SDIRA requires much more experience from the account owner. Talk to your accountant about it.
An IRA Can Now Be Emptied Later
When you reach age 73 (formerly 70.5, and then 72), you must start taking withdrawals from traditional IRAs and other qualified retirement accounts. This is called a Required Minimum Distribution (RMD). If you do not take the proper withdrawal, you face a penalty tax of 25 percent of the amount that should have been withdrawn (10 percent if you correct the omission within two years). RMDs do not apply to a Roth IRA during the owner’s lifetime.
If you are still earning money after age 73, you can continue contributing to an IRA even though it is subject to required minimum distributions (RMDs).
Remember your RMDs if you are moving back to Poland and leaving your IRA in the States.
You Can Avoid IRA Taxes Altogether
The key to minimizing taxes is planning early and emptying the account gradually so that you do not exceed the tax-free amount, or at least land in the lowest possible tax bracket. The conclusion: Take withdrawals from retirement accounts in a year when your income is lower, for example when you have lost your job or retired.
Updated October 2026.
