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Individual Retirement Accounts

An IRA makes sense when planning your retirement or investment future.

Your Social Security benefits and pension are not intended to provide all of your retirement income. And, planning ahead to pay for an education, buy a house, or fund any future goal is always wise.

Today’s IRAs provide more tax benefits and greater earnings than in previous years. You can build a series of IRAs: Traditional, Roth and Educational. We also offer IRA Share Certificates. Consult your tax advisor to determine which IRA is right for you.

Individual Retirement Account Quicklinks

Traditional IRA
Roth IRA
IRA Share Certificate
Coverdell Education Account

Traditional IRA

Access our resource center to Learn More, to Open and/or Manage an IRA account by clicking here → ‘Retirement Central’ Traditional IRA

The traditional deductible may be the best choice for you depending on your age and your needs.

  • If you are not a participant in an employer-sponsored retirement plan, you may be eligible.
  • A single taxpayer or married filing jointly may be allowed to make fully deductible contributions.
  • A single taxpayer or married filing jointly may be allowed to make reduced deductible contributions.
  • A non-working spouse may be eligible for fully deductible contributions if the spouse participates in a qualified retirement plan.
  • A working spouse may be eligible to contribute to their own IRA.
    If you are under age 70 ½ and have earned income, you are eligible.

 

To open a Traditional IRA:
Talk to your accountant or tax advisor about your Traditional IRA options, then come and see us to open yours. You may also request more information now.

These are the guidelines for a deductible IRA:

  • A maximum of up to $7,000 per year for single. For owners age 50 and over, you may contribute a maximum of $8,000.
  • Contributions can be made for the previous tax year generally up to April 15th of the current year. Check with your tax advisor for the exact date. The deadline for 2023 Contributions is April 15, 2024.
  • Money may be withdrawn before age 59 ½ to purchase a first home (up to $10,000 maximum) or pay qualified costs of a higher education.
  • Earnings are tax-deferred.
  • Any earnings and deductible contributions are taxed as ordinary income in the year the money is withdrawn.
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Roth IRA

The Roth IRA is an excellent choice for Credit Union members between the ages of 16 and 40 who have earned income.

The major advantage of this IRA is that you pay taxes on your yearly contributions, but long-term accumulation and future withdrawals are tax-free. This IRA also offers some estate advantages.

To open a Roth IRA:
Talk to your accountant or tax advisor about your Roth IRA options, then come and see us to open yours.

Some key elements of the non-deductible Roth IRA are:

  • Penalty-free withdrawals after 5 years
  • Earnings are tax-deferred and withdrawals are tax-free if the account is open for 5 tax years and withdrawals are for a qualified reason (ie. age 59 ½, disability, death, or a first-time home purchase ‘limit $10,000’)
  • Contributions allowed after age 70 ½ when employed
  • No required distribution at age 70 ½ or in your lifetime

IRA Share Certificates

When planning your retirement or investment future, be sure to consider these higher yielding certificates.

  • Offers a higher yield over fixed terms ranging from 1 to 5 years.
  • Can be renewed at the end of their terms, or transferred into your Traditional or Roth IRA Account
  • Has tax advantages of an IRA
  • Incur penalties for early withdrawals

Talk to your accountant or tax advisor about your IRA options, then contact us to start saving today! You can also print an application to open an IRA Certificate and mail, fax to (301) 856-4061, or bring to any branch location.

Coverdell Education Account

Save toward a college education.

A Coverdell Education Savings Account is a great opportunity to save toward the costs of elementary, secondary or higher education. Best of all, it’s available to everyone: parents, grandparents, other relatives, friends, and even minors (with earned income) can set up an account for any designated beneficiary under age 18.

Here are the specifics:

  • You can make non-deductible contributions of up to $2,000 per child each tax year. The accumulation of interest and withdrawals are tax-free as long as the funds are used for qualified, higher education costs.
  • If the beneficiary is not going to use the money for education expenses, it must be distributed by age 30. Funds can be transferred from one child’s account to another qualified family member.
    Contributions to Traditional or Roth IRAs have no effect on the contributions you can make to each Coverdell Education Savings Account. You can save for a child’s education and maximize contributions to your own IRA every tax year.
  • The deadline for making a contribution is the tax return deadline for the year for which the contribution is being made, generally April 15th of the following calendar year (not including extension).
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