IRAs
Individual Retirement Account
The Individual Retirement Account (IRA) is a long-term savings plan with special tax advantages. Advantage Credit Union offers the Traditional IRA, Roth IRA and Education IRA.
Traditional IRA
This IRA allows a deductible contribution of up to $5,000 for those who qualify. The earnings are tax-deferred until time of withdrawal. The income thresholds, which qualify individual and joint filers for the tax deferral, will be increased and phased in over the next ten years.
Under the laws, penalty-free withdrawals are allowed for education and first-time homebuyers.
Roth IRA
This IRA account allows up to $5,000 non-deductible contributions with all earnings being free of federal income tax if the money saved is on deposit for five years or more and used for a qualified purpose.
Qualified Distribution Reasons Include:
- Distributions made for higher education
- Purchase a first home (up to $10,000)
- Age 59 ½
- Disability
Education IRA
The Education IRA serves to help parents and others save for children’s education. Contributions are not tax deductible, but the earnings grow tax deferred. Distributions used to pay for qualified education expenses are tax-free.
Deposits are insured up to $250,000 by the NCUA, National Credit Union Administration.
For additonal information, contact our representative at (419) 529-5603, extention 240.