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Can my 11-year-old open an IRA?

May 18, 2013: 6:30 AM ET

My 11-year-old earns money umpiring baseball games. Can he open an IRA? Will it affect his college aid? — Rick Gross, Avon, Conn.

Assuming Junior is willing, a Roth IRA (which grows and can be tapped tax-free) is a home run. In 2013 he can put in the lesser of $5,500 or his earned income. Does he earn just a few hundred dollars? You'll need a firm with a low minimum, such as Charles Schwab.

Don't worry about college. IRAs aren't used to set federal aid. Though about 260 schools doling out aid ask about IRAs, retirement money is counted only sometimes, such as when a wealthy family has split up assets, says FinAid.org publisher Mark Kantrowitz.

Your son may make too little to file taxes, says H&R Block's Gil Charney, but it's not a bad idea to save W-2s or 1099s proving earned income.

— Stephanie AuWerter

Got a question for the Help Desk? Send it to helpdesk@cnnmoney.com.

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    Direct investment in foreign property, be it a mall or a second home, is a risky proposition. Sure, you could nab greater gains than in the U.S., should you be smart, knowledgeable, and lucky. But noncitizens can face extra expenses and red tape, and back in the U.S., you're subject to complex investment rules, warns Rapid MORE

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    Not quite. You can't just declare residency; you have to live there before taking off. Steps to show you've really moved to the no-income-tax state of your dreams (such as Florida, Nevada, or Texas): buying a home (and selling your old one), getting a driver's license, and registering to vote.

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    Can I take money tax-free from my 401(k) for a down payment on a home? — Dev Ananth, Plano, Texas

    You may be able to pull money out, but you can't avoid taxes. And that's not the only downside.

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    I have made a formal loan to my adult child. Do I have to report the interest I receive as income? — J.H., Texas

    Yes, interest you earn on a personal loan is taxable and should be reported to the IRS. The figure goes on line 8a of your 1040; if all your taxable interest income in a year exceeds $1,500, you also have to file Schedule B, which records interest and MORE

    Apr 6, 2013 6:30 AM ET
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  • Which contributions come out of my IRA first?

    I put tax-deductible and nondeductible money in my IRA. What comes out first? — Duane Hoffmeyer, Mesa, Ariz.

    Most money in traditional IRAs comprises tax-deductible contributions and any account earnings over the years, all of which is taxable when you pull the money out. You evidently also made nondeductible, after-tax contributions, which exit your IRA tax-free.

    To answer your question, the funds come out simultaneously. Add up your after-tax contributions. The percentage of MORE

    Mar 31, 2013 3:17 PM ET
    Posted in: Retirement, Taxes
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    I own a home in Connecticut. I'm currently paying taxes on rooms that I don't use or need. For instance, I finished a bonus room over my garage and fifth bedroom in my attic with heat and sheetrock. Can I "unconvert" these unnecessary rooms to lower my property taxes? – Debra L.

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    Dec 27, 2012 6:30 AM ET
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    If I give someone a gift over $13,000, what taxes will each of us owe? — Margaret G., Raleigh, N.C.

    Good news about the oft-puzzling gift tax: Whatever the size of your gift, the recipient neither owes tax nor needs to report it. You, the giver, have to file Form 709 for a gift over the IRS' annual per-recipient limit ($13,000 in 2012 and rising to $14,000 next year). But you won't MORE

    Dec 25, 2012 6:30 AM ET
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    Dec 24, 2012 6:30 AM ET
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