Investors are Taking Advantage of the Tax and Retirement Benefits of a 'Paperless' IRA This Tax Season; Tips On How to Make the Most of Your IRA

Business Wire, Jan 26, 2001

Business Editors

BOSTON--(BUSINESS WIRE)--Jan. 26, 2001

Within the first three weeks of tax season, 34 percent of new Fidelity Investments(R) Traditional and Roth IRAs have been opened online, paper-free. Online usage is up significantly from last season, when 7 percent of new IRA owners opened an IRA with an application they downloaded from the Web. Fidelity introduced its new paperless IRA in December 2000, allowing investors to open and contribute to an IRA online.(1)

"We are encouraged by the significant number of investors who are opening accounts online so early in the tax season, especially when you consider the continuing market volatility," says Jim McCarthy, senior vice president, Retail Retirement Services, Fidelity Investments. "Investors are looking for ways to simplify their retirement savings, so they can spend more time on planning and less time on transactions. Our new Online IRA at Fidelity.com/ira coupled with our updated Online Tax Center at Fidelity.com/tax provide that powerful time-saving benefit."

Here's a simple checklist to help ensure that you're getting the most from your IRA this tax season.

-- Consider contributing to an IRA while investing in your future.
The IRA is a retirement account that allows you to contribute up to
$2,000 (or 100% of compensation if it is less) each year and take
advantage of various tax benefits, including a tax deduction for those
who qualify. Remember, the last day to make an IRA contribution for
the 2000 tax year is April 16, 2001.

-- Choose the IRA that is right for you.

    -- Traditional Individual Retirement Account (IRA) - Allows
    qualifying individuals to annually make a $2,000 tax-deductible
    and tax-deferred contribution toward their retirement.

    -- Roth IRA - Potential earnings grow tax free and distributions
    are taken tax free, provided certain requirements are met, in this
    newer IRA option. If you meet the income limit eligibility, you
    can contribute up to $2,000 annually.

    -- SEP and SIMPLE IRAs - Simplified record keeping makes these
    employer-sponsored retirement plans convenient options for the
    self-employed or small business owner. (SEP-IRAs can be opened by
    downloading an application from Fidelity.com. You can order a kit
    to open a SIMPLE-IRA, either through Fidelity.com or
    800-FIDELITY.)

-- Consider making an IRA contribution for this tax year and next.
Tax filers on average received a refund of just over $1,600 last
year.(2) This year, turn your refund into an investment in your
retirement future. You don't have to wait until April 2002 to
contribute to a 2001 IRA. In fact, if you contribute now for the next
tax year you may take advantage of possible gains for the year.

-- Let your retirement savings grow tax free.
Do you know that you can still convert your Traditional IRA into a
Roth IRA? If you would find it inconvenient to pay all of the taxes
due when converting your entire IRA, consider converting some of the
assets this year, while converting the rest in subsequent years.

-- Save time and money by consolidating.
Bring all your accounts from previous employers' 401(k)s under one
roof in a Rollover IRA. With just a few easy steps, you will have
eliminated multiple statements, potentially reduced fees and made it
easier to monitor and track your retirement investments.

-- Do it online this year.
Look for new online tax and retirement tools to help you save time and
eliminate mistakes. At Fidelity's Online Tax Center
(Fidelity.com/tax), Quicken(R) TurboTax(R) for the Web(SM) service,
which includes the new Automated Tax Return feature, enables Fidelity
customers with non-retirement brokerage accounts to electronically
import 1099 tax information, along with cost basis information from
security sales, directly into TurboTax. This new feature makes
electronic tax preparation and filing hassle-free by eliminating the
need to enter financial data by hand. Quicken TurboTax for the Web is
free through Fidelity. Fidelity's Online Tax Center also has a link to
the company's Online IRA (Fidelity.com/ira). There you can select,
open and contribute to an IRA, and develop an investment strategy to
help meet your retirement goals.

About Intuit

Intuit Inc. (NASDAQ: INTU) is the leader in e-finance, including financial software and Web-based financial services users for consumers and small business. Intuit develops and markets QuickBooks(R), the most popular small business accounting software; Quicken(R), the leading personal finance software; and Quicken TurboTax(R), the best-selling consumer tax preparation software. An innovator in developing Web-based financial tools, Intuit is the leading provider of online tax preparation and filing and online mortgages. Intuit is also breaking new ground as a leader in online bill presentment and payment, and in the delivery of its QuickBooks Internet Gateway platform of connected e-services for small business. Intuit's Quicken.com Web site (www.quicken.com) is a leading financial site, offering a comprehensive set of financial news, information and tools, including insurance, mortgaged, investment and tax preparation services. Intuit's products and services enable individuals, small businesses and financial professionals to better manage their financial lives and businesses.