My spouse will be 70.5 in 2013. She has an IRA and a 403(b) retirement plan at work. If she continues to work, can she continue to contribute to both the IRA and 403(b)? What is to be done about mandatory minimum withdrawals?
--Name withheld

The rules are quite different when it comes to an IRA versus a 403(b).

Let's start with the IRA. Here, the fact that your spouse will continue to work has no impact. Contributions to a traditional individual retirement account (deductible or non-deductible) are no longer permitted starting the year one turns 70.5. Likewise, regardless of work, 70.5 is the magic age when required minimum distributions (RMDs) must begin — the firstwithdrawal must take place no later than April 1st of the year following the year one turns age 70.5.

But there's one big exception: Should the IRA be a Roth IRA, then contributions can continue and withdrawals are not required. (Yep, that's one of the big selling points of the Roth.)

The 403(b) is a different story. Here, if your spouse keeps working, she should be able to continue to contribute to her plan (assuming she's currently eligible) and may not need to begin withdrawals. But she should confirm this with her employer, says Gil Charney of H&R Block's Tax Institute. While the IRS says employees can wait until retirement, it's ultimately up to employer as to whether employees must start RMDs after age 70.5. But there's a good chance that she can hold off on withdrawals until after the champagne has been poured at her retirement party.

-- Stephanie AuWerter