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IRA Options

SCCU offers a variety of IRA options.  You can elect to deposit IRA funds into either an IRA premium Money Market or lock it up for a specific term at a potentially higher rate in an IRA Certificate of Deposit (CD).  We offer three types of IRAs:

  • Traditional: Traditional IRAs are special types of savings plans designed to help the owner save for retirement.  It offers tax deferred earnings and the possibility of tax deductible contributions.  Eligibility is based on:
    • Age: You must be under age 70 ½ years and must not reach age 70 ½ at any time during the year for which the contribution was made.
    • Income: You must have earned compensation* during the year for which the contributions being made, or you must have filed a joint federal income tax return with a spouse who earns compensation* during the year for which the contribution is being made.
       
  • Roth: Roth IRAs were named after Senator William Roth of Delaware, a longtime IRA advocate.  The Roth IRA allows you to contribute different amounts depending upon your age.  These contributions are not tax deductible and there are income limits to be followed.  For current limits contact one of our Loan Officers.
    • Eligibility: Roth contributions are allowed at any age, as long as the IRA owner (or spouse filling jointly) has compensation* for the year to which the contribution is attributed.
       
  • Coverdell Education Savings Account: Coverdell Education Savings Account allows parents, grandparents or any other interested persons to establish a special savings account for children under the age of 18 to save for any postsecondary education.  You can invest up to $2,000 per child younger than age 18.  Earnings will accumulate and withdrawals may be used for qualified educational expenses before the child reaches age 30.  Contributions are not tax deductible.  Funds are transferable to a qualified family member.
    • Eligibility: Beneficiary must be under age 18.  Compensation* is not needed, only income.
      *Compensation includes amounts derived from or received for personal services actually rendered.  S an alternative to using this definition, the IRS allows an employee to use the information shown as “wages, tips & other compensation:  on the IRS form W-2 to determine the compensation received from an employer.  Taxable alimony is also treated as compensation.

*Compensation includes amounts derived from or received for personal services actually rendered.  This is an alternative to using this definition, the IRS allows an employee to use the information shown as “wages, tips & other compensation:  on the IRS form W-2 to determine the compensation received from an employer.  Taxable alimony is also treated as compensation.

**IRA rules are subject to change.

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