A retirement savings plan in which you set aside tax deductible dollars and receive the benefit of tax deferred income accumulation.

Deposits in a regular savings plan are made with after tax dollars, and the investment earnings on those deposits are taxed each year as they accumulate. In contrast, contributions to an IRA are tax deductible, and the earnings accumulate on a tax deferred basis until they are withdrawn. This means that your funds grow at a much faster rate.

You may contribute up to the lesser of $2,000 or 100% of your earned income. The amount of tax deduction depends on whether you or your spouse are an active participant in an employer sponsored retirement plan, your adjusted gross income, and your tax filing status.

Not without having to pay a 10% penalty in addition to the regular income tax unless you are age 591/2 or disabled.

You can adjust your contributions each year, as long as you don't exceed the maximum allowable limit. If you choose not to make a contribution in any year, there is no penalty. However, you cannot make up the the missing contribution in future years.