Question for California banks out there:
Effective Jan.01,2002 the Federal Law increased contributions of the following types of IRAs:
Traditional IRA - from $2,000.00 to 3000.00 under 50yrs old and 3500.00 for over 50yrs old.
Roth IRA
Educational IRA - from $500.00 to 2000.00
SEP IRA - compensation limit is increased from $150,000.00 to $200,000.00.
Although the above changes took place under the Federal Law, the State of California has not adopted the new Federal contribution increased yet.
We have been told that before we accept the new IRA contribution limits, we should advise customers to seek for their tax or legal consultants because there maybe a potential tax inconsistencies between the Federal and State.
I would like to know what other California banks are doing with this situation. Are you accepting the Federal contribution limits for 2002 now or continuing to accept the Old contribution limits until the State of California adopted the new plan?