Tax Advantages
Are you tired of paying taxes on your savings every year? The interest that you earn on the money you put into a traditional IRA is not taxed until you withdraw it. The benefit for many people is that they will withdraw their IRA savings after they retire, when they likely will be in a much lower income tax bracket. Being able to defer taxes in this way can mean more after-tax dollars for your retirement.
When you file your taxes each year, all or part of the money you put in to your IRA may be deducted. The amount you can deduct depends on your income, your tax filing status, and whether or not you are also contributing to a retirement plan through your employer.
You may also be able to receive a tax credit each year. The amount of credit you receive is based on your income and tax filing status.
Make It Easy
Use payroll deduction to have contributions made to your IRA directly from your paycheck. Interest on your traditional IRA is compounded quarterly.
Pump Up Your Compounding – Increase Your IRA Interest
Choose a CD for your IRAs and receive two advantages: your interest is compounded monthly and you receive a higher interest rate.
You will find that our CD rates are the best in the area. We invite you to compare.
Show Me the Money!
You can start withdrawing your traditional IRA savings at age 59 1/2 without penalty. However, there are eleven circumstances under which you can withdraw your money early. These include medical expenses, post-secondary education expenses and first-time home purchase. Call your Financial Service Advisor for more information.
Roll It Over
If you receive a distribution from an employer’s retirement plan, such as a 401K, and you take the cash, you will pay 20% of it in federal income taxes. If you are under age 59 1/2 you may also have to pay a 10% federal tax penalty. You can avoid all these taxes and penalties by putting the money into a tax deferred traditional IRA.
Note: There is no annual fee for IRA accounts at your credit union.
For More Details
To find out your eligibility for contribution amounts, tax deductions, beneficiaries, or for other additional information, contact your Financial Services Representative at the credit union at 479-4040. We can also send you additional literature on IRAs. It is always recommended that you consult with your tax accountant or financial advisor regarding your choice of an IRA.
